Inherited ISA allowance HELP!

CaW

Hi Annikins,

I'm the one who started this thread as I, like you, was having trouble getting accurate information about what to do with inherited ISA allowances (or Additional Permitted Subscriptions, as they are officially called).

The first thing to say is very few people I spoke to in banks and building societies knew the rules. And some who thought they did were mistaken. I did my own research (following the links shared by forum users above and the banks' own terms and conditions), then politely insisted bank staff check with their ISA managers in head office. You probably won't feel like it after a bereavement (I know I didn't) but you may have to be quite determined.

Here's what we did. We transferred our loved one's ISA allowances (which were with three different building societies) to one specialist inheritance ISA with the Skipton (who were VERY helpful and understanding). As the ISA paid less than 1%, as soon as the transfer was complete, we moved the money to a new ISA with the institution offering the best ISA rate at the time. This whole process took several weeks and we could only begin it once Probate was complete.

Remember, once your money is in a specialist ISA that accepts inherited ISA allowances, you can then move it to ANY ISA that accepts transfers in, as the money is treated exactly the same as any of your previous years' ISA savings. See Point 6A.1 in the .gov document shared in a previous post. (I can't post links)

So in your case, you should be able to transfer all of your loved one's ISA savings (not just £20,000) into the NS&I inherited allowance ISA. There is no mention of a limit in the PDF xylophone shared above. Insist staff members check with an ISA manager at head office (not just their supervisor in the call centre).

Then, as the NS&I interest rate is so low, transfer your funds to new ISAs with providers offering better rates, making sure that funds remain within the FSCS limit.

There may well be other ways of doing it, but based on my recent experience, I know this way (should!) work.

Good luck. Come back if you have any questions.

badger09

@CaW

Thank you for posting this update.

I'm sure it will be really helpful to others facing the same issue, in what will inevitably be a stressful and upsetting time.

Keep_pedalling

CaW wrote: »

Hi Annikins,

I'm the one who started this thread as I, like you, was having trouble getting accurate information about what to do with inherited ISA allowances (or Additional Permitted Subscriptions, as they are officially called).

The first thing to say is very few people I spoke to in banks and building societies knew the rules. And some who thought they did were mistaken. I did my own research (following the links shared by forum users above and the banks' own terms and conditions), then politely insisted bank staff check with their ISA managers in head office. You probably won't feel like it after a bereavement (I know I didn't) but you may have to be quite determined.

Here's what we did. We transferred our loved one's ISA allowances (which were with three different building societies) to one specialist inheritance ISA with the Skipton (who were VERY helpful and understanding). As the ISA paid less than 1%, as soon as the transfer was complete, we moved the money to a new ISA with the institution offering the best ISA rate at the time. This whole process took several weeks and we could only begin it once Probate was complete.

Remember, once your money is in a specialist ISA that accepts inherited ISA allowances, you can then move it to ANY ISA that accepts transfers in, as the money is treated exactly the same as any of your previous years' ISA savings. See Point 6A.1 in the .gov document shared in a previous post. (I can't post links)

So in your case, you should be able to transfer all of your loved one's ISA savings (not just £20,000) into the NS&I inherited allowance ISA. There is no mention of a limit in the PDF xylophone shared above. Insist staff members check with an ISA manager at head office (not just their supervisor in the call centre).

Then, as the NS&I interest rate is so low, transfer your funds to new ISAs with providers offering better rates, making sure that funds remain within the FSCS limit.

There may well be other ways of doing it, but based on my recent experience, I know this way (should!) work.

Good luck. Come back if you have any questions.

I would love to know which top rate cash ISAs pay more than you get outside an ISA wrapper. Even allowing for tax you are generally better off holding your cash outside an ISA. The only reason I can see for maintaining the cash ISA is if you have plans to shift it into S&Ss at some not too distant date.

CaW

Thanks Keep Pedalling. Of course, each individual should do their own research to work out the best place to invest the funds they have inherited. Some may decide they don't want to take advantage of their spouse/partner's ISA allowance and move the money into a non-ISA product. But for people who have decided they want to keep the funds in an ISA, this was my experience of how to do it .