Transfer old ISAs and invest new money

redstarbelgrade

The MSE website says higher interest rates tend to be available for new ISAs rather than for transfers.
I want to transfer some old ISAs to get a better interest rate.
I also want to open a new ISA with a decent interest rate.
Does this all have to go into one new ISA, or can I have two within the tax year? i.e.. a new one, and one for the transferred funds?

kidmugsy

Only one new one, but as many transferred ones as you want.

Reed_Richards

Think of it this way. All your ISAs from previous tax years are old ISAs and are closed to new money. Your ISA provider may like to pretend otherwise in order to encourage you to continue investing with them but if you add new money this tax year you open a new ISA and you can only open one new cash ISA per tax year.
You can transfer your old ISAs to other providers but you must follow the correct protocol and apply for an ISA transfer. You are at liberty to take one old ISA from a previous tax year and transfer 1/100th of the money to 100 different ISA providers if you really wanted to.

soulsaver

Reed_Richards wrote: »

Think of it this way. All your ISAs from previous tax years are old ISAs and are closed to new money. Your ISA provider may like to pretend otherwise in order to encourage you to continue investing with them but if you add new money this tax year you open a new ISA and you can only open one new cash ISA per tax year.
You can transfer your old ISAs to other providers but you must follow the correct protocol and apply for an ISA transfer. You are at liberty to take one old ISA from a previous tax year and transfer 1/100th of the money to 100 different ISA providers if you really wanted to.

Not strictly accurate:
A) You can open several new cash ISAs but can only fund one with new money (ie not from previous years contributions).
New money may be transferred from one cash ISA to another provider's cash ISA in the current tax year, but it must be ALL of the new money - new money part transfers not allowed.

Reed_Richards

soulsaver wrote: »

Not strictly accurate:
A) You can open several new cash ISAs but can only fund one with new money (ie not from previous years contributions).
New money may be transferred from one cash ISA to another provider's cash ISA in the current tax year, but it must be ALL of the new money - new money part transfers not allowed.

More strictly accurate than you, soulsaver.
A) An ISA transfer does not open an ISA, it transfers some or all of an existing ISA to a new home. Treat all ISAs from previous tax years as closed to new money, so when you first contribute new money you open a new ISA. That applies whether you open a brand new ISA or you re-open a closed one from a previous year. In the latter case, the new money must be treated differently to the old money, both by you and by the ISA provider when it reports to HMRC.
True, but my answer did not mention what you can or cannot do with this year's ISA. As above, new money must be treated differently to old money.