S&S ISA Transfers Questions

sauvignon

Hi
Searched threads and spoke to a fund provider for answers but get even more confused. So please help a relative ignoramus if you can.
I wanted to open a S&S ISA with a new provider and invest in its new fund, but was told that since I'd contributed to another S&S ISA (never mind that it was opened last tax year), I am not allowed to do so unless I transfer old S&S ISA money to them. Then I'd be allowed to invest new money up to this year's limit in my chosen fund with the new provider. To me it sounds the same as my original plan, but I suspect there's a difference.

So the Q is: Do I have to transfer the same S&S ISA that I have contributed to in this tax year? Or can it be another old S&S ISA I hold? The former is performing OK while the latter isn't, so I'd prefer to transfer the poorer performer. I haven't paid into it since its opening in 1999.

Q2: If I have to transfer the one I have contributed to this tax year does it have to be a full transfer? The same question goes for the alternative option of transferring the less well performing S&S ISA.

If you can help with answers, thanks in advance for your time.

colsten

You can only make deposits into 1 S&S ISA each financial year. You can transfer this ISA to another provider as often as you like but all money deposited this year must be transferred in its entirety. S&S ISA transfers generally cost money and can take some time so think twice before you go ahead.

Does your old provider not offer the investment you are after? If so, are you sure your new provider offers the investments you have with your old provider so an in-specie transfer is possible and you don't have to be out of the market during the transfer?

Would be easier to answer if you named the providers and the investments involved.

Daniel_Elkington

Essentially, for cash ISA or SSISA you have an annual allowance. Since the first of July last year this is £15,000 for both.

Your annual allowance means you have an 'account' for cash and an 'account' for SSISA in the year. If you open an SSISA and want to open another SSISA, you still only have one SSISA 'account', ergo the money from the original must be transferred to remain with one account.

You can have one account of each type per tax year.

Does this make sense - it isn't actually how it works, just how it works in practise.

Lokolo

And this is why people have accounts with platforms such as Hargreaves Lansdown and Charles Stanley Direct. As you can buy funds from different fund providers all in one account.

sauvignon

Hi Colsten,
That was a quick answer, THANK YOU!

I am still unclear about this: ...all money deposited this year must be transferred in its entirety. I have only invested about £1,300 in my last year's S&S ISA this tax year. So do you mean I should only have transferred the newly invested £1300?

What I wanted originally was invest in a newly launched fund using a special offer by a new provider (HL). When I checked if this was possible, having already contributed to my last year's S&S ISA at the beginning of this tax year, the new provider said no, so I knew I wouldn't make the deadline for the special offer. I could still invest the remainder of this year's tax allowance in the new fund, I was told, but only after the transfer.

I then sent off the transfer application form but put my less well performing ISA on it, not the one I added the 1300 to. I now have doubts that I'll be able to contribute further to the new ISA in this tax year. Or will I?

Just minutes ago I also found that since I had applied for a stock rather than cash transfer (unfortunately I followed my own logic - I wanted a stock ISA with the new provider, not a cash one), the money will be reinvested in the same funds! Other posters beware! I will then have to switch the 2 funds to the one I wanted all along. I assume there's a fee for that.

Although my transfer form was only received on Tuesday I was told that since everything is done electronically, this couldn't be changed into a cash transfer any more. (Why then does the transfer take weeks or months as some posters write?)

The question remains: after the switch, will I be able to add money to my new S&S ISA? Sorry for the long post...

sauvignon

Hi Daniel,

Thank you for your reply which, I'm afraid, doesn't answer my questions.

What I wasn't clear about was: I haven't opened a new SSISA this tax year, I just made another contribution to the one I opened last year. OK, I understand from Colsten's reply that it's the same as if I HAVE opened a new SS ISA. I haven't used up my allowance, far from it, but wanted to invest elsewhere which, again, is not possible for the same reason. So a transfer is required. And that was my Q: to be able to invest elsewhere, i.e. with another provider and in a completely new fund, do I have to transfer the same SSISA I contributed to this tax year (and opened last year)? Or can it be another SSISA I haven't contributed to this tax year? In either case, does it have to be the whole SSISA (with different funds in it) or just some of it?

Lokolo

You have to keep this years contributions in the same account. It's that simple.

So if you have deposited £1300 into a S&S ISA and want to open a S&S ISA elsewhere, you need to ISA transfer it across to the new one.

Why didn't you just transfer the whole entire S&S ISA across instead of partly? What is your reasoning for having multiple providers for your investments?

Daniel_Elkington

yes,

If you put £1500 in a NISA with company A

Then opened a NISA with Company B; you must transfer all of A from A, you'd still be able to put another £13,500 into B.

If you then put £5000 into B and wanted to have some with C you must transfer the £6,500 to C and still be able to top-up by £7,500.

And so on.

At the end of the year you can only end up with one SSISA.

I

sauvignon

Thank you Lokolo and Daniel, for your replies.

Please don't give up on me yet. I do try to read up on ISAs etc as much as I can but it would be another full-time job for me to follow it in detail and decide about my own investments which are modest anyway. I opened my first (and until last year my only) SS ISA in 1999. It's remained untouched until this week...

So I understand you have to transfer the whole of the SS ISA you've contributed to in the current tax year if you want to try a new provider.

Now what I have actually done: Lo and behold, I transferred the 1999 SSISA to HL, not the one I paid into this tax year. Your replies indicate that I won't be able to make any new contributions to the transferred SSISA anyway, because it's not the same one I paid into this tax year and opened last year.

A simple Yes or No will do. And many thanks for your patience.

colsten

sauvignon wrote: »

I then sent off the transfer application form but put my less well performing ISA on it, not the one I added the 1300 to.

this has no bearing whatsoever on whether you can make additional contributions to your 2014-15 S&S ISA

sauvignon wrote: »

Just minutes ago I also found that since I had applied for a stock rather than cash transfer (unfortunately I followed my own logic - I wanted a stock ISA with the new provider, not a cash one), the money will be reinvested in the same funds!

what will probably happen is an "in-specie transfer". No re-investing takes place, you stay invested [until you sell your investment].


More about S&S ISA transfers here: http://monevator.com/how-to-transfer-a-stocks-and-shares-isa/

It looks as if your chosen new provider is HL (one of the more expensive platforms).

Who is your old provider?

What are your investments (the names of the funds/shares etc), in this year's S&S ISA, with the old provider?

colsten

sauvignon wrote: »

Your replies indicate that I won't be able to make any new contributions to the transferred SSISA, because it's not the same one I paid into this tax year.

Your understanding is correct.