Tell us you cash ISA questions

ldp

Ok what if it’s just savings accounts??? 

My kids have trust funds & savings accounts I pay into every month, but if I set up separate savings how much can I save??? 

masonic

ldp said:

Ok what if it’s just savings accounts??? 

My kids have trust funds & savings accounts I pay into every month, but if I set up separate savings how much can I save??? 

If you are in receipt of means tested benefits, then savings of >£6,000 will start to affect how much you receive and savings of >£16,000 will tend to disqualify you from receiving said benefits.

To avoid it being picked up later on you should declare any savings accounts you have access to, some accounts might not be taken into account (I've seen comments that child savings totalling <£3,000 may be disregarded), but this varies and you should confirm what is and isn't allowed in advance of making any plan which, in effect, hides your savings to get around a means test. Obviously these sort of things can easily cross the line into benefits fraud.

You may get better information in the Benefits & Tax Credits board, rather than the ISAs board.

masonic

For the benefit of anyone else who finds this discussion, Child Tax Credits are not means-tested based on savings. See the FAQ at the bottom of the following article: https://www.which.co.uk/money/tax/tax-credits-and-benefits/tax-credits/child-tax-credits-atxv75s3q5gc

"Child tax credit payments do not take your savings into account, and there is no limit on how much savings you can have."

So there is no reason not to build up a savings pot in an account in your own name, including a cash ISA, should an ISA have the best rate of interest available to you.

Martyna90

Hi, sorry if the question seems silly, but I am a newbie in ISA savings. I opened a 120 days notice account with Paragon in September for one year. They offer quite good interest rate, therefore I would like to open another account with them. This time it would be an ISA easy access. Would it be possible to open another account in the same tax year? If that is not possible, is there any other option to save a little bit of money each month with easy access? 

Many thanks in advance.

Aceace

Martyna90 said:

Hi, sorry if the question seems silly, but I am a newbie in ISA savings. I opened a 120 days notice account with Paragon in September for one year. They offer quite good interest rate, therefore I would like to open another account with them. This time it would be an ISA easy access. Would it be possible to open another account in the same tax year? If that is not possible, is there any other option to save a little bit of money each month with easy access? 

Many thanks in advance.

You can't subscribe (put new cash into) more than 1 cash ISA account in a tax year. So, if the 120 day notice account that you opened in Sep was an ISA then you can't contribute to an easy access ISA until April 6th 2021.
You could open and contribute to a non-ISA easy access account now. In April you could open an easy access ISA account and move the non-ISA cash into it. 
EDIT: Ignore my ignorance above. See a better informed post from @masonic below. My apologies. 

Having said that, do you really need an ISA? You mentioned a "little bit of money", so probably don't need an ISA.  A basic rate taxpayer can earn up to £1,000 interest per year without paying tax on it, so it might be better to use a non-ISA account which often pay a slightly higher interest rate.  Paragon's Triple Access Cash Account pays 0.65% (as long as you make no more than 3 withdrawls per year). Their Easy Access Cash ISA pays 0.5%. Their non-ISA Easy Access Account also pays 0.5%.

masonic

Martyna90 said:

Hi, sorry if the question seems silly, but I am a newbie in ISA savings. I opened a 120 days notice account with Paragon in September for one year. They offer quite good interest rate, therefore I would like to open another account with them. This time it would be an ISA easy access. Would it be possible to open another account in the same tax year? If that is not possible, is there any other option to save a little bit of money each month with easy access?

Yes, Paragon is a split-ISA provider, so you can open multiple cash ISAs with them and spread your annual allowance between them. https://www.paragonbank.co.uk/savings/savings-explained/flexible-isa

howy686

I have two existing cash ISA's containing only old money - can I close each one individually by transferring out the old money to two new cash ISA providers, as long as I then only invest this year's new money into one of those new accounts?

eskbanker

howy686 said:

I have two existing cash ISA's containing only old money - can I close each one individually by transferring out the old money to two new cash ISA providers, as long as I then only invest this year's new money into one of those new accounts?

You can transfer your old ISAs to one or more new ones, which should close them - this doesn't affect where you put your current year money, which could be an entirely different account again.  You can only pay new money into one ISA of each type per year though so yes, if you have two new ISAs funded with old money, you could only put this year's money into one of them.

Grahame151

Can I transfer a one year fixed term cash isa if rates alter and I am better off moving or does that only apply to variable rate ISA's

eskbanker

Grahame151 said:

Can I transfer a one year fixed term cash isa if rates alter and I am better off moving or does that only apply to variable rate ISA's

Transfers of fixed term products are permitted - as with any other ISA transfer, initiate it via the receiving provider's transfer process....