Cash ISA confusion

SFitz

Hi there – I’ve got a question about cash ISAs. A bit of background:

• I have a Santander Instant Saver Account (I don’t even know if this is an ISA if I’m honest) that I’ve had since I was a kid. I pay into this every month.
• I have a Halifax Help to Buy ISA which I opened in FY 15/16 which I pay into every month
• I have a Halifax ISA Saver Variable which I opened FY 16/17 and recently made my first deposit.

I thought that as long as I didn’t open more than one ISA a year, and didn’t pay in more than the tax free ~£15K limit between all my ISAs that this was allowed. However I recently made my first payment into the ISA Saver Variable and the bank reversed the payment. Can someone explain what I’m missing? Can I just never pay into more than one cash ISA ever? What about when my account matures (may be a dumb question as I don’t even really know what it means for my account to mature!).

jimjames

You are right that you can't pay in to more than one cash ISA hence the problem. The question then arises as to why you even want a cash ISA other than the HTB one when you can get so much better interest rates outside if you are wanting to save to buy a house.

Regular savers will give you much better rates

Chalkius

You can only subscribe to one Cash ISA per year. The HtB is a Cash ISA, so even though you opened it in 15/16, you have also been paying into it in the 16/17 tax year which subscribed you for that year. So when you made your deposit into the Saver Variable, that was not permitted as you can't subscribe to a second cash ISA in the same tax year.

Essentially, as long as you have the HtB and are paying into it, you can't have another separate Cash ISA (Some providers I believe offer a split ISA though). Once you've used the HtB for it's intended purpose you can the following tax year open or subscribe to a new Cash ISA.