Accidently transferred money out of full ISA

heloid

Hi all,

I accidentally transferred £155 out of my ISA (on Friday, now Monday) which has had the full allowance paid in to it for this year. It was one I thought I had set 3 weeks ago to come out of my normal savings account to make sure I had enough for a credit card bill and only just noticed when the balance didn't go down.
I called Santander and they said it couldn't be reversed or treated as in error.

Are there any provisions for accidental transfers/mistakes? Not a huge sum but annoying

Thanks

jimjames

Unfortunately I think you are stuck with your mistake.

I guess be thankful it was such a small amount and won't make much difference if you are a basic rate taxpayer. If you are basic rate then you might find you get better interest outside the ISA despite tax being taken off.

planteria

my understanding is that jim is right. once you've withdrawn, that is it. fwiw i think it would be good if ISA providers made it slightly more difficult to access ISA allowances....at least enough to prevent mistakes.

heloid

Thanks guys. At the end of the day it's about a £15 mistake only, oh well.

typistretired

This is what HMRC have to say about the issue in November 2009, therefore you could ask Santander why they have not updated their system as suggested:-

Managing an ISA - cash withdrawn in error by the investor

We are receiving an increasing number of enquiries from savers who have withdrawn money from an online ISA in error. Typically, the saver transposes the account numbers of the ISA and the linked current account. As a result, the investor withdraws, say, �3,600 from his ISA instead of (as intended) subscribing �3,600. And once the money has been withdrawn, the only way in which it can be put back into the ISA is by way of a fresh subscription that counts towards the annual subscription limit.

When savers contact us, they often say that the manager's website was poorly designed and did not warn them that they were withdrawing money from their ISA. If it had, they say, they would have cancelled the transaction and correctly paid money into their ISA instead.

We therefore recommend that managers review their online procedures to see what could be done to prevent savers from withdrawing funds from their ISAs in error. One solution might be a pop-up that contains the following message (or something similar)

Warning!

You are attempting to remove money from your tax-free ISA.
Is this what you want to do?

The screen could be provided with Yes and No buttons, which would enable the saver to continue with the transaction or to cancel it.

le_loup

That's what Nationwide do.

Gadfium

See this thread:
https://forums.moneysavingexpert.com/discussion/4613081

I did the same, except I transferred £10K out in error. Santander told me that it was irreversible, as did HMRC. I did plead for the benefit of the doubt as their system makes such an error too easy, but they insisted that if couldn't be changed.
A couple of days later I logged in and found that they had corrected my error (I had the £10K that I was supposed to transfer still sitting in my Santander current account).

jimjames

heloid wrote: »

Thanks guys. At the end of the day it's about a £15 mistake only, oh well.

Not sure how you've calculated that or if you've based it over a number of years.

3% interest on £155 inside ISA = £4.65
3% interest on £155 outside ISA = £4.65 - tax = £3.72

So net loss per year not being in ISA is 93p in this example.

But you may be able to get higher rates outside ISA on your £155 which would offset that eg NW Flexdirect at 5%