Cash ISAs

Ellams

Hi, I'd appreciate some advice:

I've just opened a fixed-term cash ISA with Shawbrook, planning to deposit only part of this years ISA allowance into it (because I aleady have other savings with Shawbrook and I want to stay within the FSA limit). Then I attempted to open a second fixed term cash ISA with another provider (Aldermore) to use the balance of the £20K allowance. But it appears I can only open an ISA with one provider per year, even though I don't intend to exceed the £20K limit.

Is this right?

eskbanker

Yes, you can only pay into one ISA of each type in any given tax year, so can't pay into two cash ISAs with different providers.

Some providers allow 'split ISAs' whereby you can pay into more than of their cash ISAs by classifying them as if they were one - Aldermore is one of these but unfortunately Shawbrook isn't.

As it's a fixed term product you've already opened, your options are limited, as there will presumably be a penalty charge if you were to close it early, so if you want to make full use of your annual allowance your best bet is probably to pay into an ISA of a different type late in the tax year (e.g. a stocks and shares one, keeping the money uninvested, in cash form) and transfer it to a cash one early in 2020/21.