ISA Allowance, 2nd year?

Steveswift

Hi Guys,


A simple question for you I am sure, but I am confused.


My ISA allowance is £15k as is my wives. We both purchased one last year to use our allowance up. I now have another 15k I can put away. I can't buy another iSA and therefore get tax free savings on this 2nd one can I as I have use my allowance on the first one I/we bought?


Hope that this makes sense.


Cheers


Steve

kangoora

You get a circa £15k allowance every tax year, £15240 this year IIRC.

So you can open another ISA or contribute to your existing one up to the maximum allowed (per person) before April 5th 2016

le_loup

Steveswift wrote: »

as is my wives.

How many wives do you have?

Steveswift

Lol, just the one unfortunately :0 )


Thanks guys

Steveswift

Hmmm nearly there


Last year In Jun I took about a 15k 2 year fixed ISA in my name. So June this year I will have had it for one year and get the interest made on this first year. As it is a 2 year it obv carries on.


Soooooooooooooooo That means the 2nd year of it will be using my allowance up for this year right? Therefore I can't take out say a 1 year fixed one out now and be tax free on it as well.


Sorry for being so dumb, I blame it on all of my wives

puk999

Steveswift wrote: »

Last year In Jun I took about a 15k 2 year fixed ISA in my name. So June this year I will have had it for one year and get the interest made on this first year. As it is a 2 year it obv carries on.


Soooooooooooooooo That means the 2nd year of it will be using my allowance up for this year right? Therefore I can't take out say a 1 year fixed one out now and be tax free on it as well.

That is not right. You have a fresh allowance this tax year. Are you going to make contributions to this 2 year fixed ISA in this tax year? If you aren't making contributions to it, then your new allowance can go elsewhere.

kangoora

Nope, as long as you don't add to the one you took out last year you can still start another one with the same (or a different) provider.

If the one you took out last year allows it under the T&C's, you could add another £15,240 to it this year. This may be unlikely if it's a fixed interest 2 year ISA but might be possible.

You could start a stocks & shares ISA if you wish in parallel with a Cash ISA, but you are limited to £15,240 in total across the two ISA's (Cash and S&S).

As before, you can save circa £15k, each tax year, into an ISA (unless they change the rules). This could be adding to an existing one or starting a new one if you find a better rate with someone else.

Something to take note of: You can contribute to a single cash or S&S ISA each year - but ONLY one of each. If you make any payments into a Cash ISA you can't then start another one in the same tax year.

HarryD

Interest earned within last year's ISA does not count as part of your ISA contribution for this year.

For example, you could have been contributing to an ISA (or several ISAs) for years and could have £100K in the ISA. That might earn £2K in interest/dividends. You could leave that £2K in the ISA or take it out - whichever you choose.

None of the above makes any difference to what you can do this year: you can put up to £15,240 into ISAs this year.

Steveswift

Thank you guys, understood now.


Ta


Steve