Cash ISA's - how many can I have?

greencode

This is the bit that still confuses me a little bit about the ISA. I know you can have one cash and one stocks and share ISA per tax year but what about this:

I had my first cash ISA this tax year (ending tomorrow) with Barclays and I've been told you can have 1 ISA every year. So does that mean that I can transfer my current ISA to a better rate of interest (when the new tax year starts after tomorrow) and then also open another cash ISA? SO in affect I would have two cash ISA's with two different companies?

Also, is the transferring of an ISA fairly straight-forward? I'm presuming I just need to join a new company and all of those details will be part of the joining process?

Lokolo

OK you've got the end parts right but the middle bit I will clarify.

You can open a new cash ISA on Wednesday with a new provider, so yes you can have 2 cash ISAs with 2 different companies. For example, I had 1 with Halifax, 1 with Aldermore and 1 with Birmingham Midshires over 3 years, until a couple of months ago.

But you can transfer anytime. Your current Barclays one you could have transferred months ago if you choose, or today even. You don't need to wait until the new tax year.

To transfer an ISA you need to find an ISA that allows transfers in (for example, the Santander 3.3% doesn't, nor does the Barclays Golden Cash ISA). You then ask to open the ISA by transfer, you fill in a form with the new provider, they then send it to the old provider, and retrieve the money. Depending on how lucky you are, it can take from 1-4 weeks.

greencode

Lokolo wrote: »

OK you've got the end parts right but the middle bit I will clarify.

You can open a new cash ISA on Wednesday with a new provider, so yes you can have 2 cash ISAs with 2 different companies. For example, I had 1 with Halifax, 1 with Aldermore and 1 with Birmingham Midshires over 3 years, until a couple of months ago.

But you can transfer anytime. Your current Barclays one you could have transferred months ago if you choose, or today even. You don't need to wait until the new tax year.

To transfer an ISA you need to find an ISA that allows transfers in (for example, the Santander 3.3% doesn't, nor does the Barclays Golden Cash ISA). You then ask to open the ISA by transfer, you fill in a form with the new provider, they then send it to the old provider, and retrieve the money. Depending on how lucky you are, it can take from 1-4 weeks.

Thanks for getting back to me so quickly and clarifying a few things. So I don't have to stick with the same provider each year and then open a new ISA? For example can I open a new cash isa on Wednesday with a new company and also transfer my current Barclays isa to a another new company on the Wednesday as well?

Lokolo

greencode wrote: »

Thanks for getting back to me so quickly and clarifying a few things. So I don't have to stick with the same provider each year and then open a new ISA? For example can I open a new cash isa on Wednesday with a new company and also transfer my current Barclays isa to a another new company on the Wednesday as well?

Yep, so if you want you can open a new ISA with Santander on Wednesday for new money, and at the same time, pop along to Halifax to open their ISA which allows transfers in

Funkyfreddy

Lokolo wrote: »

.....But you can transfer anytime. Your current Barclays one you could have transferred months ago if you choose, or today even. You don't need to wait until the new tax year.
.....

..but just check that there are no "early" withdrawal/closure penalties if this is done within any form of "Miinimum term" of say a fixed rate ISA. If you have say a 1 year fixed ISA you may have to wait until the end of the term to avoid a penalty - just check any T&C's.

FF

kidmugsy

You could even transfer your old Isa bit by bit to several new Isas. For instance, you might want some of the money in an e-Isa linked to your current account, some in a passbook Isa with a BS or bank with a convenient branch, and part in a term Isa paying a higher interest rate.

dtsazza

Also, while this is rarely relevant in practice, the ISA rules only constrict you to funding (that is, paying "new money" into) at most one cash and one S&S ISA per year.

You can legally open as many accounts as you want, whenever you want, without breaking ISA rules. (The individual banks might not be happy about you opening an account and keeping the balance at zero, though.)

Additionally, as kidmugsy says, you can transfer at any time, and with any proportion of the pot. If you had the motivation and patience, you could fully fund a cash ISA this year, open half a million other accounts and transfer a penny to each of them. (Again, this is in accordance with ISA rules but the banks' own T&Cs might not let you operate the account in this way, e.g. they may have a minimum balance requirement).


The point to take away from my post is that you should think about the restrictions in terms of how many accounts you can contribute to in a given year, as opposed to how many you can have.

Baldur

dtsazza wrote: »

Additionally, as kidmugsy says, you can transfer at any time, and with any proportion of the pot. If you had the motivation and patience, you could fully fund a cash ISA this year, open half a million other accounts and transfer a penny to each of them. (Again, this is in accordance with ISA rules but the banks' own T&Cs might not let you operate the account in this way, e.g. they may have a minimum balance requirement).

Incorrect - current tax year's ISA subscriptions MUST be transferred whole, your scenario (partial transfers) would only be permitted with previous tax years'/year's ISA funds.

dtsazza

Good catch Baldur - I specifically meant for the insane number of transfers to take place in the next tax year, but I realise that I didn't make that clear at all. :T

Take heed, anyone looking to follow my "plan"! :rotfl:

juliabrnvsk

Sorry for a dumb question, but just to clarify...as the new financial year has started and I still haven't topped up my current ISA account, I am considering to open a new ISA account (not S&S ) with another company...does this mean that by doing so, and paying a minimum instalment I won't be able to top up my current ISA (that I have now) until the next financial year when I will need to decide which one of ISA's I won't to top up? Is that right?

Ultrasonic

I wonder what made you reply to this old thread, rather than starting a new thread in the ISAs and Tax Free Savings section? Any more questions like this would be best posted there.

juliabrnvsk wrote: »

Sorry for a dumb question, but just to clarify...as the new financial year has started and I still haven't topped up my current ISA account...

Your post is difficult to understand I'm afraid, although I'm confident that the answer to your question 'Is that right?' is no. To clarify, did you open your 'current ISA' this financial year or during the last financial year?