Putting more than annual limit into an ISA

Picky

I am almost at this year's limit for my cash ISA. Is it possible for me to continue paying money into it, with the money above the limit being taxable? I'd prefer to keep all my savings in one place, but I've never managed to save so much before, so this is a new situation for me!

Linton

No: you will have to wait until next April.

Archi_Bald

If you are a basic rate tax payer, and may be even as a higher rate one, you would most likely be getting better interest outside a cash ISA. e.g. in a Nationwide FlexDirect or some other interest paying current account.

jimjames

You can pay in the same as the cash ISA allowance into a S&S ISA if you want to keep all your money tax free. But that means investments not savings.

kidmugsy

jimjames wrote: »

You can pay in the same as the cash ISA allowance into a S&S ISA if you want to keep all your money tax free. But that means investments not savings.

I wonder what the most cash-like investment permitted in an S&S ISA is? Perhaps some fund of short maturity corporate bonds?

grey_gym_sock

kidmugsy wrote: »

I wonder what the most cash-like investment permitted in an S&S ISA is? Perhaps some fund of short maturity corporate bonds?

perhaps iShares £ Corporate Bond 1-5yr UCITS ETF (IS15) - http://uk.ishares.com/en/rc/products/IS15 - which has a yield to maturity of 2.47%.

of course, this can go down in value (but probably not much), unlike a savings account.

dzug1

If you continue to pay cash into the ISA it will lose its ISA status, not only for the new money but for what's there already

Archi_Bald

dzug1 wrote: »

If you continue to pay cash into the ISA it will lose its ISA status, not only for the new money but for what's there already

I doubt that but the HMRC will with 100% certainty want to talk to you, and they will definitely take action regarding the overpayment.

jimjames

dzug1 wrote: »

If you continue to pay cash into the ISA it will lose its ISA status, not only for the new money but for what's there already

I'm pretty certain that most bank's systems would prevent you paying in more than the annual limit into an ISA.

The problem could come if you open another ISA with a different bank and falsely claim to have not used your allowance or use the full S&S ISA allowance as well as the cash ISA allowance.

IronWolf

kidmugsy wrote: »

I wonder what the most cash-like investment permitted in an S&S ISA is? Perhaps some fund of short maturity corporate bonds?

Nope they are wise to that trick and short dated bonds not allowed.

grey_gym_sock

IronWolf wrote: »

Nope they are wise to that trick and short dated bonds not allowed.

ah, but funds which invest in short-dated bonds do seem to be allowed. e.g. the ETF i linked to above claims to be ISA-able.