Trouble opening a H2B ISA with an ISA already open

pumpkinman

Hi, I have a specific problem I would like some advice on. I'd like to open a Help To Buy ISA before the end of the month but I already have a cash ISA open. I bank with HSBC and I just called them and they said I would need to close this ISA and open a Help To Buy ISA in a separate tax year, but of course this would begin after the November 30th deadline so is impossible.

https://www.moneysupermarket.com/savings/help-to-buy-isa/

Reading the above article it says "Some Help to Buy ISA providers, however, allow what is known as a ‘split ISA’. This means that you can effectively hold a Help to Buy and a Cash ISA in the same wrapper, provided their combined value doesn’t exceed the £20,000 maximum you can invest in ISAs this tax year."

I guess I can't do this with HSBC. Which other banks offer a split ISA? But would I need to have opened the cash ISA with one of these banks? Not sure where to go from here. Any advice on how I might be able to sort this in the next few days would be appreciated, unless I am indeed in a situation where it's impossible. Thanks.

masonic

Have you paid into the existing cash ISA this tax year (after 5th April)? If so how much have you paid into it this tax year?

You can open a HTB ISA without funding it regardless of whether you've paid into another cash ISA in this tax year or not. What you do next depends on the answers to the questions above.

JGB1955

According to https://www.moneysavingexpert.com/savings/help-to-buy-ISA/#prodtable both NatWest and Nationwide allow split ISAs.

pumpkinman

That's good news. Just looking at my statement and it seems I haven't. Only had interest payments go in and I withdrew a sum in October.

eskbanker

pumpkinman wrote: »

That's good news. Just looking at my statement and it seems I haven't. Only had interest payments go in and I withdrew a sum in October.

If you haven't paid any new money into your existing cash ISA during this tax year then you're free to open and fund a HTB ISA with any provider you choose, although this would then be your nominated cash ISA for 2019/20 so you wouldn't be allowed to pay any more into your existing HSBC one.

If you want to be free to pay into a HTB ISA and also another (new) cash ISA then it would make sense to go with one of the providers offering split ISAs, listed at https://www.moneysavingexpert.com/savings/best-cash-isa/#accordion-content-0334234523-3

masonic

pumpkinman wrote: »

That's good news. Just looking at my statement and it seems I haven't. Only had interest payments go in and I withdrew a sum in October.

If you haven't paid into the other cash ISA in this tax year, you are free to open and fund a HTB ISA with any provider.

pumpkinman

Thanks guys. So I guess I should phone HSBC (happy to stay with them) and point out I haven't paid in at all this year and open one today. They said I couldn't when I called earlier but they didn't seem too clued up.

pumpkinman

Turns out I was able to close it when I raised this point. Love this forum, thanks guy. Just gotta wait for the ISA to close and then can apply next week online assuming it all goes through, hopefully before the deadline!

masonic

Why do you need to wait for the cash ISA to be closed?

pumpkinman

masonic wrote: »

Why do you need to wait for the cash ISA to be closed?

He said the process of closing the ISA wouldn't start till Monday and I should apply online, but that I can only do this once the cash ISA is gone.

masonic

pumpkinman wrote: »

He said the process of closing the ISA wouldn't start till Monday and I should apply online, but that I can only do this once the cash ISA is gone.

He's wrong. There is no need to close the cash ISA at all. You can open the HTB ISA now should you wish, and can do whatever you like with the cash ISA (other than pay more money into it).

Never trust a bank to give you accurate information about ISAs.