Dot ComUnity Credit Union - ISA

MARTYM8`

darren72 wrote: »

I understand that but the cheque also includes the non-ISA component from your £5 share account.

Is the HMRC literally going to explode with outrage if we invest £5 more in an ISA than we should do? Its just so trivial.

And of course not everyone has cheque books anymore – they are a bit 1990s aren’t they? I also thought that basic share accounts were last in line creditor wise – so how come we are getting the full £5 back anyway if they are insolvent?

The Q&A states this – what are the ‘administrators transfers provisions’. And how am I supposed to show the ‘current year’s subscription’ when I haven’t made any. As if we haven’t had enough hassle and stress this confusion just ads to it!

http://fscs.org.uk/what-we-cover/questions-and-answers/qas-about-enterprise-the-business-credit-union/

“ISA balances will be FSCS protected as long as they are transferred to a new provider in accordance with the administrator’s transfer provisions. HM Revenue & Customs have advised that members who invest in an ISA account will be able to re-invest the balance of their funds as a single subscription. This balance will not count towards their annual limit (i.e. the investment will not be counted twice for the purposes of the individual’s tax free allowance).
Members reinvesting their ISA balance will need to show the new ISA account manager the balance held in the account at the date of administration, the current year’s subscription, and the date of the first subscription in the current year. The final statement to be sent to you by the administrators should be sufficient for this purpose.
Any new ISA subscription with these funds must be made within 180 days of the administration order (14 May 2015) and cannot exceed the balance at the date of the order.”

darren72

The part that annoys me is where it says:

"ISA balances will be FSCS protected as long as they are transferred to a new provider in accordance with the administrator’s transfer provisions"

The administrator's haven't provided any details on their 'transfer provisions' ??

Ed-1

Has everyone received their cheque yet? I've yet to receive mine, but I didn't receive some of the letters leading up to them going under either so I'm hoping they've passed on my details correctly.

MARTYM8`

darren72 wrote: »

The part that annoys me is where it says:

"ISA balances will be FSCS protected as long as they are transferred to a new provider in accordance with the administrator’s transfer provisions"

The administrator's haven't provided any details on their 'transfer provisions' ??

Yes – it would be nice if they could do what they are supposed to do.

I don’t fancy having to go into a branch of my new provider having to explain all of this farce to them and then – as has happened to one poster – have the poor branch member spending an hour on the phone trying to explain the situation to head office.

How difficult would it be for the FSCS/Cork Gully to co-ordinate and provide clear instructions and documentation (e.g. a covering letter setting out the process to give to providers) to assist us. Its probably the first time branch staff will have seen an FSCS payout involving ISAs – given that most of the credit unions which have gone under are tiny and didn’t issue ISAs.

masonic

MARTYM8` wrote: »

Is the HMRC literally going to explode with outrage if we invest £5 more in an ISA than we should do? Its just so trivial.

Since it would be regarded as new money, it could result an a subsequently opened cash ISA to be declared invalid and subscriptions removed.

I don't think the suggestion that the money could be banked and later transferred into an ISA using the statement sounds unusual. It was a similar situation with Icesave ISA money IIRC.

Edit: See http://www.fscs.org.uk/uploaded_files/Publications/Icesave_FAQs_-_bzlbowohfmkofuz.pdf Question 33 and in particular Question 36. Many people opted to receive an electronic payment direct to their linked account, so there was no need to deposit the funds via an FSCS cheque. However, I'd wait for the statement/certificate before doing anything with the cheque.

darren72

I just don't know the best way to proceed with these cheques now. We have significant amounts that are not earning any interest since 14th May. Do we bank them and then once the ISA statements are sent out (which we are told we need) we can then try and apply for a new ISA at that point.

MARTYM8`

masonic wrote: »

Since it would be regarded as new money, it could result an a subsequently opened cash ISA to be declared invalid and subscriptions removed.

I don't think the suggestion that the money could be banked and later transferred into an ISA using the statement sounds unusual. It was a similar situation with Icesave ISA money IIRC.

I agree - perhaps. But the Icesave issue was all over the news and affected hundreds of thousands of people - who bar us merry band has heard about the EBCU collapse?

The advantage of using the Administrators cheque is that its clear what the source is. A personal cheque is not in the same way.

They just seem to be making this overly difficult for us - and aren't explaining what to do properly at all. Its just rather poor - as if we haven't suffered enough stress over this for four months. We shouldn't have to rely on this forum for an explanation of the process - that is what the administrators and FSCS are paid to do.

Why aren't the FSCS providing some sort of documentation for us - isn't that their job.

masonic

MARTYM8` wrote: »

I agree - perhaps. But the Icesave issue was all over the news and affected hundreds of thousands of people - who bar us merry band has heard about the EBCU collapse?

Hopefully the Icesave issue will at least have given the banks some experience in dealing with FSCS bailouts so someone might remember what to do.

The advantage of using the Administrators cheque is that its clear what the source is. A personal cheque is not in the same way.

That's true, but some banks require opening deposits to be made by personal cheque anyway. You might have missed my post edit above where I dug out the FAQ from Icesave. In that case there was no cheque for most people, just a time-limited certificate with an entitlement to deposit £X into an ISA as a transfer - that should be all that is required.

They just seem to be making this overly difficult for us - and aren't explaining what to do properly at all. Its just rather poor - as if we haven't suffered enough stress over this for four months. We shouldn't have to rely on this forum for an explanation.

I agree, again comparing with Icesave, this is being handled much worse.

Why aren't the FSCS providing some sort of documentation for us - isn't that their job.

I suspect when you get your statement things will become clearer, but they have not done well on the communication front.

hgt

Well I'm in the same boat... received a cheque (without any notes on the reverse) and a statement for my share account only.

I really hope things are made clearer when the ISA statement comes through. Adding that pesky £5 to the compensation cheque has really confused things. I really don't fancy paying in the compensation cheque and then transferring into my ISA using a personal cheque. How will I explain that to my new provider!

Surely we should all get issued with some kind of certificate to prove the tax-free status of our funds.

gwapenut

I lay the blame squarely with the FSCS. I asked them where I could point Nationwide to on their webpage to allay NW's fears, and they told me to browse to NEWS (what??), EBCU and then it's buried in their - but does nothing to allay the fears that NW expressed to me quite clearly and rationally.

It talks about not affecting this year's subscription, which NW accept, however NW state that they believe it is enshrined in law that only one S&S ISA can be opened per tax year. They can't buy the excuse from me (I know another poster was luckier) that it is a transfer, because in their eyes transfers need a sort code and account number to transfer from, not a cheque.

On the one hand I feel a little frustrated with NW, but on the other the poor girl listened to my story and my counter-arguments, and couldn't get past the advice she'd been given by the central team. It's certainly not clear cut, and the FSCS does absolutely nothing whatsoever to help us win these arguments apart from say "HMRC said it was alright so all these 1000s of customer service assistants should remember that guidance note for this rarest of rare situations and just do what they're told". Not helpful.