urgent advice needed please

sam1970

I have my cash saved in a 5 years fixed ISA at Coventry building society. I still have £5000 for this year which I did not save (did not have spare cash) but as I dont want to,lose it I want to put it into an ISA before 05 April 2019.
My ISA saving with Coventry BS is above the £85000 protection limit so ideally I want to open a new ISA account with another bank for the £5000 now and then add next year allowance to it. Am I allowed to do that? Someone told me that I can only open the new account with Coventry BS for now then can move it after 05 April but not keen on that as I have already exceeded the protection limit with them....Advice please

bowlhead99

If you have contributed any new money to an ISA with Coventry already this 2018/19 tax year, the new £5000 must also go with Coventry because current year contributions must all be in the same account (or, if the financial institution supports it, you could have multiple ISAs with them which they report to HMRC as if it was one big ISA)

But you can't have some 2018/19 cash ISA subscriptions at Coventry and some 2018/19 cash ISA subscriptions with a different organisation somewhere else.

However, if the ISA at Coventry is all earlier year contributions, which were put into an ISA before 6 April 2018, then your new £5000 can go anywhere you like - because you wouldn't be breaking any rules about 'current year subscriptions must stay together' if the £5000 is the only 2018/19 subscription you've made.

sam1970

Many thanks for replying. Unfortunately my ISA account with coventry includes 15K for the year 18-19 so I guess I will have to open another easy access ISA with them before 05 April, then move it after that date to another bank where I will be depositing the 19-20 allowance.

eskbanker

sam1970 wrote: »

Unfortunately my ISA account with coventry includes 15K for the year 18-19 so I guess I will have to open another easy access ISA with them before 05 April, then move it after that date to another bank where I will be depositing the 19-20 allowance.

As bowlhead99 said, there are some providers with whom you can pay into multiple ISAs of the same type without breaching the 'one ISA of each type per tax year' rule, but I don't believe Coventry are one of these, which effectively means that you can't pay anything into a second cash ISA with them (or anyone else) for the rest of this tax year.

However, if you already have over £85K in your Coventry account and have another £5K burning a hole in your pocket with another £20K to come after April, you might wish to consider using non-cash ISAs for some of your money? The fact that you're using a 5-year fixed account would suggest that you anticipate no short to medium term requirement for your savings but chances are you'll still be losing real-terms value to inflation over that period, so it may be worth investing the surplus via a S&S ISA instead, into which you could pay this year's residual allowance?

short_butt_sweet

i agree it might be worth considering the merits of putting a little in S&S ISAs.

however, if you definitely prefer to maximize cash ISAs, then you could do that by subscribing £5,000 to a S&S ISA now, leaving it in cash inside the S&S ISA, waiting until 6 april, and then transferring the S&S ISA to your preferred cash ISA provider. this keeps within the ISA rules, because you would be subscribing to a cash ISA and a S&S ISA this tax year, not to 2 cash ISAs. and once the tax year is over, you can transfer to a different ISA type, without this affecting the rule about subscriptions.

to do this, you'd want to use a S&S ISA provider who lets you hold cash without investing it, and who doesn't charge to open, close, or transfer out as cash. i think one provider that meets all those criteria is https://www.youinvest.co.uk/isa