Santander talking rubbish re: H2B & LISA's?

Gil.I.Am

Hi,

My gf had existing savings and a cash ISA with Santander (both open for several years), and as we're thinking of buying a house in the next year/18m I said she should open a H2B as I already did a while ago and then we both open LISA's this month in case we don't buy within the next year, giving us the option of transferring into that next April. She left it til the last minute but still got the H2B opened online with Santander end of March, but transferred the opening £1,200 from her savings by mistake rather than the cash ISA as I'd said she should. She rang Santander the next day to try and get it sorted but the girl she spoke to said it was fine and didn't make any difference? Which confused me as I thought that meant contributing to two cash ISA's in one year which isn't allowed, but figured the bank must know what they're talking about.

Now on Saturday she gets a letter from Santander saying they've closed the H2B as she's paid into two cash ISA'S in the same tax year?! She rang them again and the guy insisted this was right, but then also told her she wouldn't be able to open both a H2B again now and a LISA in this same tax year when I was under the impression they count as different types of ISA? She's going to ring their complaints department as I'm pretty sure both people she's spoken to haven't got a clue, but just wanted to double check before she does as from what I can work out they've now potentially cost her £300 in the govt bonus (as she wont have the £1400 from the H2B to transfer in above the 4k LISA limit) as well as meaning she can't now open a LISA this year if the second guy she spoke to is right?

Thanks in advance for your help, hope I've explained that clearly enough it's all far too complicated! :beer:

Ed-1

Gil.I.Am wrote: »

Hi,

My gf had existing savings and a cash ISA with Santander (both open for several years), and as we're thinking of buying a house in the next year/18m I said she should open a H2B as I already did a while ago and then we both open LISA's this month in case we don't buy within the next year, giving us the option of transferring into that next April. She left it til the last minute but still got the H2B opened online with Santander end of March, but transferred the opening £1,200 from her savings by mistake rather than the cash ISA as I'd said she should. She rang Santander the next day to try and get it sorted but the girl she spoke to said it was fine and didn't make any difference? Which confused me as I thought that meant contributing to two cash ISA's in one year which isn't allowed, but figured the bank must know what they're talking about.

Now on Saturday she gets a letter from Santander saying they've closed the H2B as she's paid into two cash ISA'S in the same tax year?! She rang them again and the guy insisted this was right, but then also told her she wouldn't be able to open both a H2B again now and a LISA in this same tax year when I was under the impression they count as different types of ISA? She's going to ring their complaints department as I'm pretty sure both people she's spoken to haven't got a clue, but just wanted to double check before she does as from what I can work out they've now potentially cost her £300 in the govt bonus (as she wont have the £1400 from the H2B to transfer in above the 4k LISA limit) as well as meaning she can't now open a LISA this year if the second guy she spoke to is right?

Thanks in advance for your help, hope I've explained that clearly enough it's all far too complicated! :beer:

First of all to get the purely factual points clear:

A Help to Buy ISA is a cash ISA so you can't pay into a standard cash ISA and a Help to Buy ISA in the same tax year, so Santander were correct in their reaction to subscribing to both. The person you spoke to gave misinformation.

A Lifetime ISA is not a cash ISA so you can pay into both a Lifetime ISA and Help to Buy ISA in the same tax year. The person you spoke to gave misinformation.

The correct way to achieve your objective was to withdraw the cash ISA funds to a non-ISA account, close it and then transfer into the Help to Buy ISA (if the cash ISA funds were more than £1,200 in current year subscriptions), or simply transfer up to £1,200 using a formal ISA transfer if the funds it contained were less than £1,200 in current year subscriptions.

You can complain about the misinformation given in retrospect but as the misinformation wasn't the cause of the customer's mistake they might not be interested.

Going forward a Help to Buy ISA and Lifetime ISA can be subscribed to but only £4,000 a year can be put into the Lifetime ISA and the bonus can only be used on one to buy a house.

isasmurf

HMRC have an ISA helpline, which may be able to provide some guidance

0300 200 3312

Opening times:
8am to 8pm, Monday to Friday
8am to 4pm, Saturday

Gil.I.Am

That's great, thank you both for your responses. I will get my gf to ring that ISA helpline to clarify before she goes any further with Santander