ISA movement and ideas for growth.

Skylark77

I am presented with a dilemma. My mother has £11,000 of my money in a Santander ISA Saver paying a rate of 0.60%. I have read under no circumstances to cash this out and according to Martin, a transfer is the best option. However, I don't believe you are able to transfer this money to another person regardless if they are related. So my question is whether to leave the money in this old ISA account or cash out and look for a better Tax-Free rate and open a new account in my own name. I should also state that I do not live in the UK and reside outside of the country, so legally not sure given I am not a UK taxpayer if this is legally possible regarding establishing a new account. 
I am also interested in compound interest accounts and whether this would be a better option than a new ISA. 

grumiofoundation

Skylark77 said:

I am presented with a dilemma. My mother has £11,000 of my money these 2 statements are contradictory in a Santander ISA Saver paying a rate of 0.60%. I have read under no circumstances to cash this out and according to Martin, a transfer is the best option. - this is assuming you want to keep the money in an ISA. However, I don't believe you are able to transfer this money to another person regardless if they are related. So my question is whether to leave the money in this old ISA account or cash out and look for a better Tax-Free rate and open a new account in my own name. I should also state that I do not live in the UK and reside outside of the country, so legally not sure given I am not a UK taxpayer if this is legally possible regarding establishing a new account. 
I am also interested in compound interest accounts and whether this would be a better option than a new ISA. what is a compound interest account?

If the money is yours why is it not in your name?

Does the money need to be in an ISA? (for example are you going to pay tax on interest?)

If you live abroad you cannot contribute to an ISA. 

masonic

Skylark77 said:

I am presented with a dilemma. My mother has £11,000 of my money in a Santander ISA Saver paying a rate of 0.60%. I have read under no circumstances to cash this out and according to Martin, a transfer is the best option. However, I don't believe you are able to transfer this money to another person regardless if they are related. So my question is whether to leave the money in this old ISA account or cash out and look for a better Tax-Free rate and open a new account in my own name. I should also state that I do not live in the UK and reside outside of the country, so legally not sure given I am not a UK taxpayer if this is legally possible regarding establishing a new account. 
I am also interested in compound interest accounts and whether this would be a better option than a new ISA. 

If you've given this money to your mother, and she's saved it in her cash ISA, then you are correct that it cannot be directly transferred to a cash ISA in your name because the 'I' in ISA stands for Individual, and they are not transferable between individuals. You cannot open a cash ISA in your name if you are not UK resident, so even if she were to withdraw the money and give it back to you, you'd not be able to save it in an ISA unless your circumstances change.

ISAs are a UK savings vehicle and are generally not recognised as tax free abroad. If you are saying that this is your money and your interest, then you may be evading tax in your country of residence by putting this money into an account in someone else's name. However, if your mother is benefiting from the interest and you are just intending to ask her for the original amount back at some point in the future, then you won't have received any foreign income that could be subject to taxation.

Any UK savings account will have interest paid without deduction of tax, but tax may be payable in your country of tax residency. As you've not stated where you are resident, and probably know more about the tax rules there than us UK folk, it's going to be difficult to comment on whether you can earn interest tax free in any UK savings account, and whether there are more suitable products for you to use as a non-resident.

Skylark77

Thank you for the response. 

Robert_McGeddon

If your Mum was to die suddenly how would the administrator/executor of her estate distribute the £11,000?