Is this transfering?

montyb41

Hi,
Both me & the missus have cash ISAs, we max'd mine out last year as it was paying a better rate & I have continued to pay into it this year, so i guess my ISA is active.
we haven't paid anything into the missus ISA yet this year apart from the small amount of interest its getting from 0.50%, so this one shouldn't be an active ISA
We could look at transferring the balance into a new ISA for her, but I was wondering, if we move some of the money from her ISA into a joint account we have & then move it again from there into my ISA, is that ISA Transfering?
cheers

TheMatrix_2

In order to transfer you have to let the ISA manager do the transfer direct from ISA to ISA. Usually you need to complete a form with the new provider to ask the old provider to transfer the funds to the new ISA.

You cannot do the transfers yourself using a non ISA account as you'll lose the ISA protection for your previous years allowance, if you do. Also ISA's are individual so you wont be able to transfer between husband and wife in that way.

LardyCake

This thread may be instructive: http://forums.moneysavingexpert.com/showthread.php?t=3302440

montyb41

Thanks,
In all the years ISAs have been running I never realised you could transfer previous years totals into a new ISA & that amount wouldn't count towards the present years total...duurrrr...
ah well its not that bad, to be honest we have tended to use the ISAa more as a regular savers account (but with Tax-free interest rate) - regular saving & then dip into it when we need to (pay for holiday or car) so the overall totals aren't high & in most years we haven't managed to save up to our allowance. hence why we were going to move the wifes total from last year into mine to max it out

I'm sure one year when I set up a Nat west ISAplus in branch, the advisor allowed us to take money out of my wifes ISA, put it into a joint account & then move it again into my new ISA. but he never mentioned transfering my old ISA into the new one, infact I think he moved it & said it counted toward the current years total!! it was a few years ago now so I cannot remember exactly what he did.

I think now we might look at transfering the wifes previous allowance, although, as its below 3K would be it better to just take it out of her old ISA & open a new ISA with a good rate like the Santender or AA ones - they don't accept previous years transfers, but presumably would accept cash or cheque)?
cheers

TheMatrix_2

Like you say you'd have to withdraw it and then pay it into the AA as they don't accept transfers.

ISA's are a minefield in terms of rules. If say your personal allowance was £5340 a year and you paid in £2,500 this tax year and withdrew it, you'd be able to put in a further £2,840 in the current year. You'd never be able to put the £2,500 back in this year though you could put it in your wifes ISA that way.

If you're not maxing out both your ISA's that's probably how they did it, you both have a brand new ISA allowance every new tax year, and what you have paid in previous tax years, can be frozen, transferred or withdrawn and does not count towards the new years allowance.

spikyone

montyb41 wrote: »

I think now we might look at transfering the wifes previous allowance, although, as its below 3K would be it better to just take it out of her old ISA & open a new ISA with a good rate like the Santender or AA ones - they don't accept previous years transfers, but presumably would accept cash or cheque)?
cheers

They will accept a cheque, but I would suggest that you transfer your money to a Halifax Direct ISA Reward, it pays 3.2% if you have one of their current accounts (and if you don't, then you should - £5 a month 'interest' is pretty good!). As an added benefit, Halifax pay ISA interest from the day they receive your transfer form, so you'd earn interest for the same period regardless of which account you took out.

You never know what will happen later in the year, if you unexpectedly have some spare cash you will get more benefit by transferring your current ISA.