HTB ISA - Have I understood it correctly?

edited 30 November 2015 at 10:21PM in ISAs & Tax-free Savings
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SKIPPYSKIPPY Forumite
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edited 30 November 2015 at 10:21PM in ISAs & Tax-free Savings
I think I've got it but would like just like confirmation I have understood everything correctly so don't make any errors.


My son opened a cash isa in Sept 2014. He has been paying into this Isa in this tax year - as I understand he can still open the new HTB Isa from tomorrow but must stop paying into the current cash Isa when he does so or does he need to close this ISA?


With the HTB Isa you can only pay in 1200 in the first month and 200 thereafter so are effectively forfeiting the remaining yearly ISA allowance - Have I understood this correctly?


I will get him to buy his own place and move out ... eventually 😁


Many Thanks

Replies

  • SncjwSncjw Forumite
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    I think he can still pay into one but can't open another cash Isa if he has opened a htb Isa this tax year.
    As he opened it in sept 2014 he should be fine. He is free to open another cash isa in the new tax year in April
  • edited 30 November 2015 at 10:56PM
    MDMDMDMD Forumite
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    edited 30 November 2015 at 10:56PM
    SKIPPY wrote: »
    My son opened a cash isa in Sept 2014. He has been paying into this Isa in this tax year - as I understand he can still open the new HTB Isa from tomorrow but must stop paying into the current cash Isa when he does so or does he need to close this ISA?


    The general rule is If he has subscribed (paid in) to any cash ISA in this year he cannot pay into another (but can pay into S&S).

    There are a couple of exceptions
    1. if he transfers the subscriptions made, in full, into another ISA, he can pay into the new ISA
    2. Some providers (such as Nationwide, Natwest) use a wrapper to allow you to pay into multiple ISAs in their range.

    number 1 won't always work with HTB as he can only transfer a maximum of £1,200 into a HTB ISA.

    Usual health warning:: check that an ISA is the most appropriate vehicle.
  • colstencolsten Forumite
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    Sncjw wrote: »
    I think he can still pay into one but can't open another cash Isa if he has opened a htb Isa this tax year. l
    No he can't, unless his ISA is with Nationwide, Natwest or Aldermore.

    He should be able to request an ISA transfer to one of these, and then be entitled to both, subscriptions to the HTB ISA and to another cash ISA.

    However, why he would want to subscribe to a non-HTB ISA at all is questionable. See other threads.
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