ISA New Tax Year

MarmiteIndifferential

Hello all,

The tax year starts on the 6th of April. If I open up a cash ISA with, say, Al-Rayyan or something, could I then open up a Help to Buy ISA in the new tax year and keep both? Or would I have to have a split ISA?

Many thanks,

Marmite

eskbanker

You can only pay new money into one cash ISA (including HTB) in any given tax year, unless you have multiple ISAs with one of the providers who offer the split version.

bowlhead99

You can have completely different ISAs on the go at once for 2015/16 on one hand and 2016/17 on the other - and 2017/18 and so on if you have more hands. The rule is just that whatever tax year you're actually in, that "current year"s money must stay together.

So for example if you put money into Al-Rayyan in 2015/6 you couldn't then also put some money in 2015/16 into Halifax or Nationwide without first transferring all the 2015/16 Al-Rayaan money there so that all the current year money sits together (i.e. the 2015/16 subscriptions are sitting either all in one single ISA or all in a single provider's split ISA).

But if the 2015/16 money went into Al-R, then in 2016/17 that money can stay in Al-R and new money can go into Halifax or Nationwide. By that point (i.e., when you're in 2016/17), the 2016/17 will be the 'current year', so all 2016/17 money would need to stay together (e.g. Halifax or Al-R but not both), but the old 2015/16 money would no longer be the 'current year' and could be transferred among several different providers if you wanted.

colsten

MarmiteIndifferential wrote: »

...... could I then open up a Help to Buy ISA in the new tax year and keep both? ....

If you are eligible for a Help To Buy ISA, you should be looking to maximising the best HTB ISA (Halifax atm) and the best current accounts and regular savers (see other MSE Forum thread).

If you are limited by shariah-compliant accounts, I fear you might not be able to get an HTB ISA as no shariah-compliant provider is on the current list of providers at the time of writing.

MarmiteIndifferential

Cheers for the reply. Would that mean that as soon as this financial year is over, I wouldn't be able to add money to an ISA that was opened in this tax year, next tax year?

bl4ckj4ck

I have a cash ISA from previous tax years and during this tax year I paid in around 9K.

Last week I opened an HTB and topped up 1K + 200£.

Did I do anything wrong?

eskbanker

bl4ckj4ck wrote: »

I have a cash ISA from previous tax years and during this tax year I paid in around 9K.

Last week I opened an HTB and topped up 1K + 200£.

Did I do anything wrong?

Yes - you're only allowed to pay into one cash ISA in any given tax year, unless you're with a provider who supports the split ISA model, such as Nationwide and a few others. Who are your ISAs with?

Alter_ego

bl4ckj4ck wrote: »

I have a cash ISA from previous tax years and during this tax year I paid in around 9K.

Last week I opened an HTB and topped up 1K + 200£.

Did I do anything wrong?

HMRC will eventually contact you and close one of the ISAs. The provider will refund including gross interest. You will probably owe the tax.
HMRC told me not to try doing it in advance when they contacted me (mine was a 5yr fixed) Took 18 months till they sorted it out.
No criminal record or anything nasty.

bl4ckj4ck

thanks for your reply.

The ISA is with Santander and the HTB with Halifax. So, no spilt ISA.

It was my understanding that you are ok until you stay under your annual allowance of 15,24k.

Do I have to contact anyone to sort this out properly or I can just close one of those accounts?

I'm pretty relieved that there is no criminal record.

eskbanker

bl4ckj4ck wrote: »

It was my understanding that you are ok until you stay under your annual allowance of 15,24k

When you opened your Halifax HTB ISA, you would have declared within your application that "I have not subscribed, and will not subscribe, to another cash ISA in the same tax year that I subscribe to this Cash ISA", which is also reiterated on their 'at a glance' summary on the product page ("You cannot pay into another cash ISA in the same tax year").

To sort this out, see the question "I already have a cash ISA – can I open a Help to Buy: ISA too?" at https://www.helptobuy.gov.uk/help-to-buy-isa/faq/

MarmiteIndifferential

If I had a cash ISA from a previous tax year, would I be able to open up a HTB ISA in the next tax year and pay into both at the same?