Subscribing into an old ISA

Imvrasos

What happens when current tax year subscriptions are paid into an old ISA? Can the old ISA money transferred freely between providers after a current subscription is paid?

To provide an example, suppose £100 are paid into a cash ISA on 5 April, with a further £1 paid in the next tax year in the same account, on 6 April. Effectively we have both old and new money in the same account. Are the £100 flexible to be transferred per current ISA rules?

Tom99

Yes you can, all or part of the £100 already invested. You can also transfer the current years subscription but it has to be the whole of the subscription, £1 in your example.

See here:

https://www.gov.uk/individual-savings-accounts/transferring-your-isa

Imvrasos

Thank you for the quick post. Therefore, I do not need to open a second cash ISA with the same bank, for new money. Also, the account in my example does not need to close when the £100 (or part of it) is transferred out, as long as the £1 (new money) stays in.

Tom99

Imvrasos wrote: »

Thank you for the quick post. Therefore, I do not need to open a second cash ISA with the same bank, for new money. Also, the account in my example does not need to close when the £100 (or part of it) is transferred out, as long as the £1 (new money) stays in.

Yes that's my understanding but you will only be able to top up your £1 into the same account this year, you can't deposit new money in any other account.

jimjames

What you have described is possible but maybe not sensible. Old cash ISAs don't tend to have very good rates so you may be better with a new one or not even using cash ISAs at all when better rates are elsewhere. Really depends how much you are saving and what your plans for it are

Paul_DNAP

A lot of the finer detail will be down to the terms & conditions of the product you've opened, rather than the governing rules.


You need to make sure that the account you open will allow extra money in other than the initial deposit (some fixed term accounts are opened then locked).


Similarly, check the T&C to see when that balance will be available for transferring to another provider, and if the account allows partial transfers or they will only allow "close & transfer" on that account. Also check if you agreed to a minimum term and if they will hit you with a penalty for moving the money out before then.