Tell us you cash ISA questions

jezzer_72

Can I save into a Help to Buy ISA and a stocks and Shares ISA or Cash ISA at the same time?

masonic

jezzer_72 wrote: »

Can I save into a Help to Buy ISA and a stocks and Shares ISA or Cash ISA at the same time?

A Help to Buy ISA is a cash ISA. There would be no problem saving into this and investing into a S&S ISA elsewhere. To pay into a HTB ISA and another cash ISA in the same tax year, you would need to hold both with a split-ISA provider, such as Nationwide.

Cecilia66

Nationwide are paying less than 2% so I would like to know what rate you are on

Pepod

Question:

I know that unused ISA allowance does not carry over year on year. I currently have only put a very small amount in my ISA this year, but I have a reasonable amount of cash available at the minute, and anticipate having more in the next 6 months or so. Given that I currently (for the next few months) need the flexibility of having the cash - can I deposit up to this years allowance, withdraw it again almost straight away and then carry over that allowance as 'used' into the next year allowing me to deposit more post April?

Thanks.

eskbanker

Pepod wrote: »

I know that unused ISA allowance does not carry over year on year. I currently have only put a very small amount in my ISA this year, but I have a reasonable amount of cash available at the minute, and anticipate having more in the next 6 months or so. Given that I currently (for the next few months) need the flexibility of having the cash - can I deposit up to this years allowance, withdraw it again almost straight away and then carry over that allowance as 'used' into the next year allowing me to deposit more post April?

The short answer is no.

Perhaps you're getting confused with flexible ISAs, where you can withdraw and then replenish (without counting towards annual allowance) within the same tax year, but that effectively still means that your aggregate ISA savings at the end of any tax year can be no more than £20K higher than at the start (excluding growth/dividends/interest earned within the ISA(s)).

lawz85

Hi,

Apologies if this is the wrong thread or if this has already been answered but I've been going round in circles a while now.

I have a current Cash ISA with First Direct which I have been paying into this 2018/19 year. I would ideally like to open both a Cash LISA (possibly with Skipton) and a Help to Buy ISA (possibly with Barclays), as I understand I can have both (but only use the government bonus from one when buying a house).
My current cash ISA has £10,000. Ideally I would like to transfer the ISA so as not to lose the tax-free benefits, but how do I go about doing this given the LISA and H2B deposit limits? There are no penalties for transferring or closing my First Direct ISA (already checked), however I can only open a Help to Buy ISA with a max of £1,200. What happens to the remaining £8,800 in my ISA? Can I specify at the time that I wish to open another ISA type with a different provider or is that a bit too complex?
Or, as it's almost March, am I best of closing the ISA entirely (for the sake of 1 month tax-free to get to the end of the financial year), putting the money into my regular current account and then applying separately for the H2B / LISA with the maximum allowance? I do not want to open the LISA first and transfer the Cash ISA into this (as a) it's over the £4,000 limit and b) I'll be penalized for withdrawing anything from this).

I hope this makes sense. Any help would be greatly appreciated!

eskbanker

I'd suggest that you open a LISA now and make a partial transfer of £4,000 into it from your FD ISA. Transfer another £4,000 on or after 6 April.

Also after 6 April, open a HTB ISA and transfer £1,200 in.

In each case, while the usual recommendation is to make direct ISA-to-ISA transfers to preserve the tax-free status, this isn't really an issue unless you're anticipating getting close to paying £20K into your ISAs in any given tax year, so each of the above 'transfers' could equally well be enacted by withdrawing and paying back in....

The residual £800 in your FD ISA can be used for drip-feeding into the HTB at £200 per month.

Elika0215

On here it shows the top Cash ISA account rate of 1.74% with penalties for a year. The top fixed rate is 2.01%. So, for 10k lump sum savings in an normal savings account I'd get £1201 after a year (no tax as my total interest would be under £1k).

So, what's the point of a cash ISA in this instance with a £10k single lump sum investment?

masonic

Elika0215 wrote: »

On here it shows the top Cash ISA account rate of 1.74% with penalties for a year. The top fixed rate is 2.01%. So, for 10k lump sum savings in an normal savings account I'd get £1201 after a year (no tax as my total interest would be under £1k).

So, what's the point of a cash ISA in this instance with a £10k single lump sum investment?

None for someone in your situation. Cash ISAs are useful for a very small minority, such as higher rate taxpayers who have already used all of their personal savings allowance.

...and the best 1 year fix is even better than 2.01%

Elika0215

masonic wrote: »

None for someone in your situation. Cash ISAs are useful for a very small minority, such as higher rate taxpayers who have already used all of their personal savings allowance.

...and the best 1 year fix is even better than 2.01%

Thank you. Which account is better than 2.01% as that was the top displayed on here (with FCS protection) isn't it?