Can someone else pay into my ISA?

junai139

Hi,

Is it possible for a third party to pay into my ISA on a monthly basis?

lisyloo

Yes.

Are they gifting you the money?
In which case there could be inheritance tax due if they die within 7 years and it's not exempt from IHT.
So basically normal gifting rules apply.

dunstonh

They cant pay directly into your ISA but they can pay you as a gift and you can then pay it in.

junai139

Yes it would be a gift transferred from a personal bank account on a monthly basis . Would the bank scrutinise this and think it was money laundering?

Lokolo

If the amounts are varying in large and small deposits, at different times of the month, then yes.

But a static amount at the same time of the month, then no.

lisyloo

They cant pay directly into your ISA

I paid into someone else's ISA using BACS with their sort code and account number.
It was my husbands but I don't think that made any difference.
You can pay money into any account you like with BACS, providing you have the account details.
Not sure why you can't when I've done it???

JimmyTheWig

dunstonh wrote: »

They cant pay directly into your ISA but they can pay you as a gift and you can then pay it in.

If this wasn't you saying this, dunstonh, I wouldn't believe it. I've never heard this.

AirlieBird

When you sign your ISA application form you are declaring that "All subscriptions made, and to be made, belong to me"

dunstonh

JimmyTheWig wrote: »

If this wasn't you saying this, dunstonh, I wouldn't believe it. I've never heard this.

Looking at the HMRC ISA rules it says (under section 6.6):

Investors can subscribe cash to either type of ISA. They must subscribe with their own cash, and this includes payment by cheque, direct debit, charge card, credit card, telegraphic transfer and standing order. Cash subscriptions from third parties can be accepted without question unless the ISA manager holds information that shows that the cash does not belong to the investor.


The problem is that this is that its contradictory. First bit says own money including cheque, debit card etc. However, second bit says cash from third parties is allowed unless the ISA manager knows it does the cash does not belong to them.

How this tends to get interpreted by ISA managers is that cheques, direct debits and debit cards have to be drawn on an account belonging to the same person.

I would say that cheques from third parties should be rejected as the ISA manager can clearly see that they are drawn on a third party. However, the lack of checking on low value cheques and the lower knowledge of rules by bank clerks nowadays probably allows many to go through. Physical cash is probably the only item that can go into cash ISAs without question (subject to money laundering regs).

The OP was looking at monthly payment which would suggest direct debit or standing order. In which case the money should come from their own account (although if using BACs, there probably isnt anyone checking).

ses6jwg

Just so you dont fall foul of the rules, I would reccomend they make a payment to your bank account, then you set up a SO for an identical amount to go out 3 days later

System

That's not contradictory. It becomes "your money" at the moment the 3rd party indicates that he is gifting it to you, or by depositing a payment into your account.

Your salary becomes yours when your employer pays it into your account. Nobody quibbles about its source.