We'd like to remind Forumites to please avoid political debate on the Forum. This is to keep it a safe and useful space for MoneySaving discussions. Threads that are - or become - political in nature may be removed in line with the Forum’s rules. Thank you for your understanding.

ISA FAQ

2»

Comments

  • isasmurf
    isasmurf Posts: 1,999 Forumite
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
    My TOISA's about to mature. What can I do?
    It can be transferred to any Cash ISA.

    In a HMRC Bulletin to ISA managers it says
    Transferring a TESSA Only ISA

    We have been asked to clarify the rules on transferring TESSA Only ISAs. In particular, can a TESSA Only ISA (TOISA) only be transferred to another account designated as a TOISA?

    A TESSA Only ISA (TOISA) is a special type of cash component ISA – one that was set up to receive the capital invested in a matured TESSA. The normal rules for transferring ISAs therefore apply: subscriptions to a TOISA may be transferred to another account designated as a TOISA, a cash mini-ISA, or the cash component of a maxi-ISA.

    The main industry body for ISAs also has a useful page:
    http://www.tisa.uk.com/savings.html?scheme=3
    The ISA Regulations made provision for the capital from a matured TESSA, which had matured after 5 January 1999, to be subscribed to a cash Mini ISA, the cash component of a Maxi ISA, or to a TESSA only ISA
    and (emphasis theirs)
    It should be noted that, where TESSA capital was subscribed to a TESSA-only ISA, this classification only remained until the end of that tax year after which the ISA was simply a cash ISA and, as such could be combined with or transferred to any other cash ISA held by the investor.

    There has been no such thing as a TESSA-only ISA since 6 April 2005.
    (However a number of cash ISA products aimed at ex-TESSA savers are marketed with product names such as TESSA ISA etc.)
  • isasmurf
    isasmurf Posts: 1,999 Forumite
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
    New rules will come into force for ISAs from 6th April 2008 (subject to approval by Parliament).

    How do they affect you?

    The draft legislation
    • Remove the designations of 'Mini', 'Maxi' and 'TESSA only' from the regulations

    • There will be two types of account, a cash account and a stocks and shares account. Each account will hold only a cash component or stocks and shares component (as appropriate).

    • The overall subscription limit will increase to £7,200, of which no more than £3,600 can be put into the Cash account. It is up to investors to determine how to utilise their overall limit, as long as no more than £3,600 goes into the Cash account.

    • existing TOISA and Mini Cash ISAs will be redesignated Cash accounts

    • existing Mini Stocks & Shares will be redesignated Stocks & Shares accounts

    • existing Maxi ISAs holding only Stocks & Shares will be redesignated into Stocks & Shares account.

    • existing Maxi ISAs holding both a Stocks & Shares component and a Cash component will be split into their appropriate components so the S&S becomes a S&S account, and the Cash becomes a Cash account.

    • Cash (current and previous years) can be transferred to a Stocks & Shares account

    • existing PEPs will be redesignated Stocks & Shares accounts and will fall under ISA rules
This discussion has been closed.
Meet your Ambassadors

Categories

  • All Categories
  • 346.7K Banking & Borrowing
  • 251.4K Reduce Debt & Boost Income
  • 451.5K Spending & Discounts
  • 239K Work, Benefits & Business
  • 614.5K Mortgages, Homes & Bills
  • 174.9K Life & Family
  • 252.2K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 16K Discuss & Feedback
  • 15.1K Coronavirus Support Boards

Is this how you want to be seen?

We see you are using a default avatar. It takes only a few seconds to pick a picture.