Isa help!!

mjoy1986

Hello all,

I need some help with regards to my ISA. I took it out last year and have a direct debit come out of my current account into my ISA every month. Now last years tax year is over will this direct debit stop? Am i right in thinking that I can no longer put money into this ISA? I should open a new one?

Thank you in advance! New to this saving business :-)

opinions4u

Who's the ISA with?

Is it a cash ISA?

Is it a direct debit or standing order?

What do the terms and conditions of the account require?

I think you need to talk to the people who provide your account, because it's going to be hard to get a clear answer here with so little information.

tanith

My husbands ISA that is set up with a standing order each month just continues paying into the ISA till he tells them to stop.. so if you want to stop it you have to tell them. But you should look at the interest rate for the ISA you are using as the interest rate has probably dropped to rock bottom and you should look at others paying a better rate, if you find one you like and it accepts transfers in then you can ask them to transfer in your old one and pay in new money for this years allowance..

spikyone

tanith wrote: »

so if you want to stop it you have to tell them. But you should look at the interest rate for the ISA you are using as the interest rate has probably dropped to rock bottom and you should look at others paying a better rate, if you find one you like and it accepts transfers in then you can ask them to transfer in your old one and pay in new money for this years allowance..

Quite true. The only way to make sure you're not still paying a DD or standing order is to contact your bank, and get them to cancel it. You should do this even if you're at the end of a contract and any further payments would result in overpaying - it's not unknown for recipients to make an admin error!

You could continue to use the old ISA if you want, but again tanith is right - if the rate was top last year, there's a good chance it won't be now, so find out what you're getting. There's lots of advice on the ISAs board, a quick recommendation would be that if your rate isn't good (3%+):

1) Transfer your old ISA to a Direct Reward ISA with the Halifax. Don't pay any other money into this, and get Halifax to do the transfer by filling in the transfer form on their website. It's quick and easy, I promise!

2) Take out a new ISA for this year's allowance. The reason for doing this is that the best-paying ISAs don't allow you to transfer in.

...and remember, in a year's time, check the rates again to get the best deal. Good luck!

(Edit:
I should have mentioned that this only applies to instant access ISAs, if you're on a fixed term ISA then it won't apply. As opinions4u says, check what your ISA is and whether there are restrictions on transferring out.)

Jacka87

Ok similar but slightly different question. I have an ISA from two years ago, rate 3% and I have checked it was still 3% as of about a week ago. I stayed with this ISA last year as it wasnt a bad rate, tho I cant remember if i cchecked to find a better rate.

At the moment I have about 4k in it, as I had to withdraw some money out last year. i notice that the best instant access ISA is now about 3.3%, thats only 0.3% better than my current ISA and was considering transferring the money accross to said ISA. However I dont think that rate of ISA accepts transfers, so does that mean I can open the new 3.3% ISA and leave my current ISA to just role on as it is, assuming I havent and dont pay any money into it this year?

spikyone

Jacka87 wrote: »

i notice that the best instant access ISA is now about 3.3%, thats only 0.3% better than my current ISA and was considering transferring the money accross to said ISA. However I dont think that rate of ISA accepts transfers, so does that mean I can open the new 3.3% ISA and leave my current ISA to just role on as it is, assuming I havent and dont pay any money into it this year?

Yes, unfortunately the 3.3% rate doesn't allow transfers in.

But you are right, you can leave your old ISA as it is without paying in this tax year, open the 3.3% rate ISA and use that for new money.

It's worth watching interest rates anyway - you can still transfer the old ISA if a high-paying account is launched later in the year that does accept transfers. There's no limit to how many ISAs you can hold at one time, or open in a tax year, as long as you only subscribe (pay in) to one in each tax year.

Jacka87

spikyone wrote: »

Yes, unfortunately the 3.3% rate doesn't allow transfers in.

But you are right, you can leave your old ISA as it is without paying in this tax year, open the 3.3% rate ISA and use that for new money.

It's worth watching interest rates anyway - you can still transfer the old ISA if a high-paying account is launched later in the year that does accept transfers. There's no limit to how many ISAs you can hold at one time, or open in a tax year, as long as you only subscribe (pay in) to one in each tax year.

Cheers for confirming my thoughts. Just realised that its 3.5% if you hold a mortgage with them so I will hopefully get that rate as well which is even better. Just need to go cancel the standing order before it tops up my existing ISA!!!

mjoy1986

Thank you for all of your advice!! Really Helpful! One last question... I promise! Could I continue to pay into my old ISA as well as into the new one I have just applied for?

spikyone

No, you can only subscribe to one cash ISA in a year (see my previous post). Which is why you need to check your rate and if necessary stop your DD/standing order as soon as possible

spikyone wrote: »

There's no limit to how many ISAs you can hold at one time, or open in a tax year, as long as you only subscribe (pay in) to one in each tax year.