Cash ISAs: The Best Currently Available List

Lokolo

Lady_K wrote: »

If I topped it up again in April would it regain its tax free status too?

It still has its tax free status. The things youve lost out on is the £3600 (well £3599) from this year remaining tax free. That exact money will never be tax free again.

However as you said, in April you can deposit £3600 so balance will be £3601 (rather than what you could have of £7200 if you kept the money in there). Thats what we mean when we say the £3600 has lost its tax free status, it means if you left it you could have another £3600 tax free.

Hope thats clear..

Lady_K

Think its a bit clearer now thanx.

I'll keep the isa open and top it up after April plus I'll open another new one in April too and gradually top that one up aswel

Lokolo

Lady_K wrote: »

Think its a bit clearer now thanx.

I'll keep the isa open and top it up after April plus I'll open another new one in April too and gradually top that one up aswel

Sorry no you can't do that.

You can only contribute to one ISA a year. You can either a) top up the ING one or b) open a new ISA and top that up by £3600 meaning you then have 2 ISAs, one with £1 and one with £3600

Lady_K

Thankyou,

So I'll retop up my ing isa in April this year then open another isa the following April and top that up is that allowed? and would they both be tax free and earn interest?

tiptoe_mouse

Lady_K wrote: »

Think its a bit clearer now thanx.

I'll keep the isa open and top it up after April plus I'll open another new one in April too and gradually top that one up aswel

Unfortunately, you can't do this. You can only subscribe to (pay new money into) one ISA per tax year. So come April, you can either pay up to £3600 into your existing ING ISA during the tax year, or you can open a new ISA (with a better rate) elsewhere and pay up to £3600 into that one over the course of the tax year.

However, you may be able to put funds in this tax year as well. Have you already paid in £3600 to your ISA since last April? If not, you can pay more money into your ING ISA now. In fact, if you haven't put any money at all into an ISA this tax year, you can open a brand new ISA now and pay in up to £3600 before April.

HTH

tiptoe

Edit: Someone types faster than I do!

fullstop

An example: Say you had £2000 in your ISA, you withdraw £1000 you can now only top it up by £1600 this tax year.

gelato_cat

You can only contribute up to £3600 in total to ONE cash ISA per tax year.

This still stands if you withdraw any money, ie if you put £3600 into your ISA, then take out £600, you can't replace the £600. Or if you put in £2000 and take out £1000, you can only put in another £1600 (not £2600). Allowances are only good for that tax year, ie if you didn't use last year's allowance you can't put twice as much in this year.

Each tax year you can either add to the ISA you already have (if the provider allows it) or open a new one somewhere else and put your year's contributions into that.

This is how people end up with 10 ISAs etc.

Additionally, you can sometimes open ISAs which allow you to transfer existing ones in (depends on the T&C of the account) - this allows you to consolidate all your savings. This is regardless of how much of your annual limit you have used up, eg I am in the situation now where I once had three ISAs - one with £3k, one with £6k and another with £27k - and transferred all of them into a new ISA last year, then topped that up with this year's £3600 allowance.

When transferring, you must follow the proper transfer process (your provider can advise you), because any time you withdraw cash from an ISA the cash loses its tax-free status which cannot be reinstated.

HTH

Suze

gelato_cat

You can top it up by £1600 to make £3600 innit?

Suze

fullstop wrote: »

An example: Say you had £2000 in your ISA, you withdraw £1000 you can now only top it up by £600 this tax year.

fullstop

Suzey wrote: »

You can top it up by £1600 to make £3600 innit?

Suze

Yes just realised my mistake,better edit. Done it

Suzkin

Thanks, Suzy.

When ISAs are consolidated, is it ever possible to 'un-consolidate' them, and spread the risk, retain flexibility etc?