Confused about my Barclays ISA

zelda_ooccoo

I was really pleased with the Issue 2 ISA I had with Barclays last year so opted to go with the Issue 3 ISA this year. I transferred everything I had accrued in the Issue 2 ISA to my regular account and then opened an Issue 3 ISA and transferred it into there. I'm assuming I wasn't allowed to do this because early in May Barclays transferred most of the money in the Issue 3 account back into my current account and took off a couple of pounds of tax deduction, leaving me with only a few hundred pounds in there.

Obviously I'm going to get very little interest on this. I'm wondering whether anyone can tell me what I did wrong and advise me as to whether there is any way I can transfer everything to an alternative ISA account (any recommendations?) Sorry to sound naive about all this but the information I read about ISAs really leaves me confused.

grizzly1911

zelda_ooccoo wrote: »

I was really pleased with the Issue 2 ISA I had with Barclays last year so opted to go with the Issue 3 ISA this year. I transferred everything I had accrued in the Issue 2 ISA to my regular account and then opened an Issue 3 ISA and transferred it into there. I'm assuming I wasn't allowed to do this because early in May Barclays transferred most of the money in the Issue 3 account back into my current account and took off a couple of pounds of tax deduction, leaving me with only a few hundred pounds in there.

Obviously I'm going to get very little interest on this. I'm wondering whether anyone can tell me what I did wrong and advise me as to whether there is any way I can transfer everything to an alternative ISA account (any recommendations?) Sorry to sound naive about all this but the information I read about ISAs really leaves me confused.

I do this with SWMBO ISA each year when the rate falls after the bonus period.

When did you open your ISA2 pre 5/4/2010 or after that date?

When did you open ISA3 pre 5/4/2011 or after?

You are not allowed to have any more than one cash ISA open in any tax year. If you had both open in the tax year ended 5/4/2011 then that will be the reason.

Also you are only allowed to subscribe your full ISA cash limit once. If you withdraw and then top up that isn't allowed.

I suggest you look around for another good one as the Barclays rate has now fallen back for new accounts.

Lokolo_2

When exactly did you make these transactions? To me it looks like you've tried to manually transfer money from one ISA to another which isn't the correct process. (although Barclays ISA's don't accept transfers in anyway)

What you have done counts towards your annual ISA limit, so if you'd already used most of that limit up in your Barclays Golden ISA 2, and in the same tax year you opened a Barclays Golden ISA 3, then you'd only be able to top up to the ISA limit, not move the whole lot from 2 to 3 as this would bring you over the limit.

Hence why the money was returned and you were taxed on interest as you contravened the ISA rules.

To add to what Grizzly1911 has said, you can open and have as many ISA's as you like, it is contributing which is limited, you may only contribute new funds to ONE Cash ISA per tax year up to the annual ISA limit. If you had followed the correct ISA transfer procedures then that would not have affected your annual ISA limit.

blueberrypie

grizzly1911 wrote: »

You are not allowed to have any more than one cash ISA open in any tax year. If you had both open in the tax year ended 5/4/2011 then that will be the reason.

This is misleading. You can have any number of ISAs, and you can even put money into numerous ISAs in the same year as long as it's done by transferring funds from one to another, using the ISA transfer process. The limit is only on how many you can *subscribe* to - i.e. put *new* funds into - in any tax year.

grizzly1911

blueberrypie wrote: »

This is misleading. You can have any number of ISAs, and you can even put money into numerous ISAs in the same year as long as it's done by transferring funds from one to another, using the ISA transfer process. The limit is only on how many you can *subscribe* to - i.e. put *new* funds into - in any tax year.

Thanks for adding clarity. You are absolutely right I should have made that clearer.:embarasse

Like PP s I think the OP has jumped the gun in rolling over the ISA for a better rate.

Each year OH rolls over an ISA, once the bonus rate drops away, into a new one as they don't allow transfers in. I just make sure it is done in the new tax year.

Barclays will allow you to simply transfer from old to new on Internet Banking. If you get the dates wrong and double subscribe it must get picked up in back office afterwards.

Starbird

grizzly1911 wrote: »

I do this with SWMBO ISA each year when the rate falls after the bonus period.

When did you open your ISA2 pre 5/4/2010 or after that date?

When did you open ISA3 pre 5/4/2011 or after?

You are not allowed to have any more than one cash ISA open in any tax year. If you had both open in the tax year ended 5/4/2011 then that will be the reason.

Also you are only allowed to subscribe your full ISA cash limit once. If you withdraw and then top up that isn't allowed.

I suggest you look around for another good one as the Barclays rate has now fallen back for new accounts.

I am new here what does SWMBO mean?

grizzly1911

Starbird wrote: »

I am new here what does SWMBO mean?

She who must be obeyed.:-)

zelda_ooccoo

So what does it mean when Barclays don't accept transfers in? You can't transfer all the money from the previous year's ISA account into the new one?

So now I've got an issue 3 ISA open with only a few hundred in it I can't close that and open up another one elsewhere?

xrjtg

You can transfer it out, you just can't transfer your old ISA money into it.

pqrdef

zelda_ooccoo wrote: »

So what does it mean when Barclays don't accept transfers in?

If they accepted transfers-in, you could

(a) transfer in money saved in previous tax years, and it wouldn't count against your current year's allowance

(b) transfer in money already saved in a different ISA in the current tax year, without it being counted twice.

But they don't, so you can't. All money paid into a Golden ISA counts against the allowance for the year it's paid in, irrespective of where it was before or whether it's already been counted once.

The likeliest explanation for what they've done is that you've paid money into the Issue 2 ISA on or after 6 April 2011, and this plus the amount you paid in to the Issue 3 ISA exceeded the annual limit of £5340.