What to do with matured ISAs?

scottishblondie

George_Mainwaring wrote: »

Thanks to everyone for helping me understand ISAs better.

If I have multiple fixed-term ISAs mature in one year (because 2-year and 3-year ISAs were taken out in different years and matured in the same year), can I transfer them all into a new ISA?

Yes.

Also, what happens if I have two fixed term ISAs mature at different times of the year? If I open a new ISA when the first one matures, transferring it into the new account, what happens when the second one matures? By then I won't be able to start a new ISA for that year, so how do I transfer it?

You can open as many ISAs as you like, as long as you only pay "new" money into 1 a year. So you could transfer a 2012 ISA in March, and then transfer a 2013 ISA in June, either to the same account (if the T&Cs allow) or another new account.



I didn't see any way to do this when I opened my ISA. It was a fixed-term account so I couldn't have any more money added to it once it was open. Also, I paid in the full ISA allowance for this year so I didn't think I'd be able to have anything more put into it anyway.

Interest doesn't count as adding money.

Since all I was asked for was which account I wanted the interest paid into (I chose my normal every day savings account), what should I have done?

I'd suggest you call the bank and ask if it is possible to get the interest paid into the ISA instead.

See above. I think you are making it too complicated. The rules to ISAs are pretty simple:

1. Only pay new money into 1 ISA per tax year - but you can open as many as you like.
2. Use the official transfer procedure to move money between ISAs.
3. Interest doesn't count towards your allowance.

Jevvers

Hi
You're still getting sidetracked by the new ISA thing - transferring ISAs has no impact on your current year.

So where you say "I will have used up the allowance for that year" - you won't have, you will have simply moved say year 11/12 to a better rate. The money stays labeled as 11/12 no matter where you transfer it to as long as you do a transfer and don't simply withdraw it.

This is how you can end up transferring tens of thousands of pounds in one year (if you've built up several years' ISAs) and STILL pay in your current year's money.

Likewise with interest, the limit is on how much YOU PAY IN, not the balance of the account. So if the bank pays you interest that's fine. Some accounts don't do it though as you've found.

Hth