ISA - need clarification on something bank said

Legacy_user

Hi,

I have received some information from my bank about my ISA and I want to know if it is true.

Here is my story:
1. I had an ISA with Barclays
2. I filled that ISA to the max around April 10th. I think it was about £5600 but definitely within the limit of the ISA.
3. I transferred that ISA to Nationwide in July as they had better interest rate. That ISA also became a NISA.
4. I deposited £2k funds in the NISA in July.

Nationwide have told me that I should not have added funds to my NISA as I am only allowed to deposit funds in one ISA per year. They told me that the Inland Revenue will probably contact me about it.

1. Are they right? I thought a transfer meant that I could continue to deposit funds as long as I did not go over the limit within a year.
2. What will the IR tell me to do?

Incidentally, Nationwide told me this when I popped in to ask them about my deposit limits in my NISA. They told me that I could not deposit any more funds. If they are wrong, how much could I deposit?

Slightly miffed on this, I read so much documentation before transferring and thought I understood it.

Thanks
Jason

colsten

If you have asked Nationwide to transfer your entire 2014-15 ISA and they have done that, you can then - subject to the Nationwide ISA T&Cs - make further deposits into the Nationwide ISA, to use up the full annual allowance which is £15K this year.

The Inland Revenue doesn't exist any longer - it's been the HMRC since 2005. Here is what they say about transfers: http://www.hmrc.gov.uk/isa/faqs.htm#6

HMRC will not have any issue if you followed the above and deposit no more than a total of £15K this year.

What is the name of the ISA you have with Nationwide?

BTW, Nationwide is a Building Society, not a bank.

eskbanker

As per previous post, the answer is dependent on Nationwide's own Ts & Cs but as far as the HMRC rules are concerned, further subscriptions into a cash ISA after transferring current year funds are also covered by sections 11.20 to 11.22 of http://www.hmrc.gov.uk/isa/isa-guidance-notes.pdf

badger09

moneyunwise wrote: »

Hi,


1. I had an ISA with Barclays
2. I filled that ISA to the max around April 10th. I think it was about £5600 but definitely within the limit of the ISA.
3. I transferred that ISA to Nationwide in July as they had better interest rate. That ISA also became a NISA.
4. I deposited £2k funds in the NISA in July.

Jason

Exactly how did you transfer your Barclays ISA to Nationwide, and how much was it in total?

System

Using the bank ISA transfer system.

I have now gone online to the Building Soc online system, and found a page that explains what my remaining allowance is it matches my understanding. The guy was completely wrong, or to be generous, did not understand what I was saying.

Your_Hero

The bank staff are often wrong on these things. You are fine from the sounds of it.

sorcerer

Did you deposit the £5600 into Barclays on the 10th April, then deposit money into your new NISA with nationwide in July?


If you did then you have paid money into two ISAs with two different banks in the same financial year, and this is not allowed.

System

ok. That is exactly what I did. However, I transferred my Barclays ISA to the NISA in July.

Are you saying that I cannot deposit into an ISA, transfer the ISA, and make new deposits in one financial year. The important point being that the ISA was transferred.

Lokolo

moneyunwise wrote: »

ok. That is exactly what I did. However, I transferred my Barclays ISA to the NISA in July.

Are you saying that I cannot deposit into an ISA, transfer the ISA, and make new deposits in one financial year. The important point being that the ISA was transferred.

What you did is correct. What sorcerer said isn't correct with your scenario.

bri160356

As long as you transferred your Barclays ISA in its entirety (that’s important!) into your newly opened Nationwide NISA before you’d made any other deposit into the new Nationwide NISA, then all is well.

Your remaining annual allowance effectively gets ‘transferred across’ from Barclays to your new Nationwide NISA.

If, however, you opened a NISA with Nationwide and paid into it before you had transferred your ISA from Barclays (you said you’d previously added to your Barclays ISA this year) then you have transgressed and HMRC will “strike down upon thee with great vengeance and furious anger “......

..........well probably not; I think they just take away the tax exemption and send you a letter of admonishment; for first offenders anyway..:eek:

thenudeone

moneyunwise wrote: »

Using the bank ISA transfer system.

What exactly do you mean?

Was it
1) You completed the RECEIVING bank/BS's forms (possibly online) asking them to contact the SENDING Bank/BS and request a transfer
or
2) You logged into online banking (or similar paper instruction) and made a funds transfer yourself?