Cheshire Building Society ISA

ProfessorDavey

My wife and I applied for a Cheshire Building Society cash ISA for the 2011/12 year, which was a top rated and highly publicised product.

We applied online on 30th March and sent the form plus cheque to the address requested on the morning of the 31st March. We each sent separate forms in different envelopes, but they were posted at the same time. We followed the exact procedure specified by the Building Society (and indeed they provided no other options that to post a cheque to a Freepost address). We both received e-mail confirmation at 8pm on the 30th March which stated that 'We are delighted that you've chosen to open a Cheshire Direct Cash ISA with us.'

Yesterday we both received a letter informing us that they hadn't opened the account because the funds were received after the HMRC deadline. They also said they had destroyed the cheques. When we rang to complain, they claimed both applications were received on the 11th April. Now I know the postal service is not great sometimes but the likelihood of two separate items taking 12 days to be delivered to Swindon from Hertfordshire seems vanishingly small.

I strongly suspect they have been overwhelmed with applications and were simply unable to process them. They have also, conveniently, destroyed the cheques which clearly indicate a 30th March date.

Has anyone else had problems, or can advise on the route forward. We are both extremely angry as we have lost our entire 2011/12 year cash ISA allowance.

pqrdef

I haven't figured out the point of the Saturday morning mail collection, if it happens at all, but I suspect it's equivalent to Monday.

If we suppose your cheques were received Tuesday 3rd and banked the same day, then allowing for the long weekend, 11th April would be day 4 of the cheque clearing cycle. Seems about right.

They ought to have stopped accepting applications earlier. Thursday would probably have been the last day for posting cheques.

psychic_teabag

What are you doing about your 2012/13 allowance ? Will you be waiting until the end of the tax year again ? If so, just switch to paying in at the start of the tax year from now on. So basically use last year's money to fund this year's ISA, then the money you would be using next March for next year's ISA, and so on.

ProfessorDavey

pqrdef wrote: »

I haven't figured out the point of the Saturday morning mail collection, if it happens at all, but I suspect it's equivalent to Monday.

If we suppose your cheques were received Tuesday 3rd and banked the same day, then allowing for the long weekend, 11th April would be day 4 of the cheque clearing cycle. Seems about right.

They ought to have stopped accepting applications earlier. Thursday would probably have been the last day for posting cheques.

Where we post there is certainly a Saturday lunchtime pick up and items posted on Saturday morning are often delivered on the Monday, so no issue on that front.

No the Building Society never presented the cheque, they claim they didn't receive the posted items until the 11th (both of them) and did nothing more than destroy them and send a letter. The person we spoke to last night in Customer Service, did however, inadvertently let out that they had had a very high level of applications, but claimed not to have had a backlog. We have no meaningful way of knowing whether our cheques were sat in their delivery for days as they dealt with their back-log - compounded by the long Easter weekend.

ProfessorDavey

psychic_teabag wrote: »

What are you doing about your 2012/13 allowance ? Will you be waiting until the end of the tax year again ? If so, just switch to paying in at the start of the tax year from now on. So basically use last year's money to fund this year's ISA, then the money you would be using next March for next year's ISA, and so on.

Yes, of course dealing with things at the beginning of the year is the way to go, but not everyone has the funds available to do so. We can of course do this now for the 2012/13 year as we still have our balance sat in our account (we kept checking to see when the cheques would clear), but that doesn't alter the point - we have missed out on a whole year ISA allowance, having applied before the deadline and followed the process specified by the Building Society to the letter.

I also find it remarkable that the Society can simply destroy our cheques prior to making contact with us about this. That seems completely inappropriate. As you can imagine we are extremely peeved.

psychic_teabag

I don't think the date on the cheque proves much : you can write any date you like on it ! The date on the postmark would be much more interesting, but...

Sorry, it's probably not coming over, but I do sympathise. But I don't think you've actually lost out. Yes, you've lost your whole 2011/12 allowance. But in return, you get to use your 2012/13 allowance at the start of the year, rather than the end, and so you still get a whole year of tax-free interest. So if you continue to invest at the start of the tax year from now one, you'll actually have exactly the same amount of money in ISAs as before.

The thing you've lost, or rather used up, is the ability to switch from last-minute to early-bird if you came by a windfall or something.

bigfreddiel

ProfessorDavey wrote: »

Yes, of course dealing with things at the beginning of the year is the way to go, but not everyone has the funds available to do so. We can of course do this now for the 2012/13 year as we still have our balance sat in our account

okay, you've lost out on one year's isa allowance - but you've bought peace of mind now as from now on you can fill your isa allowance from th beginning of the year and each subsequent year from now on - easier less stressful and i too used cheshire for my isa this year - 2012/13 - no problems!

and look at this this way - by using your isa allowance at the very last minute you've lost a years worth of tax free interest anyway!

hope that helps

fj

ProfessorDavey

psychic_teabag wrote: »

I don't think the date on the cheque proves much : you can write any date you like on it ! The date on the postmark would be much more interesting, but...

Sorry, it's probably not coming over, but I do sympathise. But I don't think you've actually lost out. Yes, you've lost your whole 2011/12 allowance. But in return, you get to use your 2012/13 allowance at the start of the year, rather than the end, and so you still get a whole year of tax-free interest. So if you continue to invest at the start of the tax year from now one, you'll actually have exactly the same amount of money in ISAs as before.

The thing you've lost, or rather used up, is the ability to switch from last-minute to early-bird if you came by a windfall or something.

Actually we have lost out, because we had sufficient funds that we received recently for both our 2011/12 and 2012/13 allowances, so we planed to open a 2012/13 ISA straight away too. We have lost a year's allowance.

But the plot thickens. The letter says:

'Unfortunately we received your funds after the HMRC imposed deadline of midnight on 5th April 2012, we cannot therefore open a 2011/12 Cash ISA on your behalf. We have cancelled your application and securely destroyed your cheque'.

Yet my wife spoke to another person at the Cheshire yesterday who gave a completely different story. He said the account had been opened, the cheque had not been destroyed and was being processed, but because of the back-log may not clear until the end of April. He claimed he was basing this view on looking at details of our account in his system. He was totally unaware of the letter and bemused by its content.

Now, firstly we have no idea which of these completely contradictory lines to believe. Secondly, and critically, had we simply assumed the letter to be correct and moved funds from the cheque account or even used them for another ISA (2012/13) and the line we received yesterday is correct - we end up with a bounced cheque, or massively overdrawn with consequent problem with our bank, and charges etc. How many others are receiving these letters, which appear to have been auto-generated and will believe their cheques have been destroyed when in fact they are being processed.

The level of incompetence is astonishing.