Is It A Fact That All ISA transfers have interest backdated ?

bristolleedsfan

following eventual former portman ISA account transfer out, nationwide members services informed me that

"i know you were concerned about the loss of interest while cheques were
being posted from us to the new accounts, however i would like to assure you that in ISA transfers the interest is backdated to ensure no loss is
incurred"

does anyone know if there is an official isa rule regarding the above assurance as many people on here believe that a loss of interest is involved when transferring out isas to most banks/building societies.

Mikeyorks

bristolleedsfan wrote: »

.... if there is an official isa rule regarding the above assurance as many people on here believe that a loss of interest is involved when transferring out isas to most banks/building societies.

I've transferred a couple - and seen the out and in dates co-incide. But I think it's a tactical arrangement rather than prescriptive. I've looked a while ago - but a quick glance again at the HMRC guidance reveals a lot about 'best practise' in transfers - and clear rules about co-inciding the transfer dates (for reporting purposes) .... but nothing whatsoever about the money orientated date. It seems a bit 'buyer beware ' as this appears to be the only related aspect under transfers :-

The terms of a transfer should be agreed between the investor and both ISA managers

....this is the more general (Appendix) note about co-inciding the dates - the money bit is (understandably?) absent. As presumably HMRC consider it's 'commercial' and not a system aspect they can / should legislate on :-

The transfer date is the date on which the old manager ceases to be responsible for the ISA wrapper (as opposed to the investment(s) within it) and the new manager starts to be responsible for it, whether or not he has actually loaded it onto his computer system on that date.
The regulations require a single date. It is therefore essential that the old and new managers use the same date as the transfer date.
The transfer date will impinge on manager's reporting responsibilities

Ian_W

Just to add to what Mike says ...
YBS open the account from the day after the the transfer cheque is dated by the previous provider - I know that to be correct.
When I enquired on here about KRBS I was told they pay interest 4 days after they receive the cheque. Their T&C's state that there is a 3 day clearing period where funds are transfered [presumably, day 1 doesn't count as they haven't cashed the cheque].

" Note: We will pay interest three working days after we receive the funds "

So on that basis I don't think there can be a standardised "no interest loss" rule.

Sorry if you saw part of this post - premature posting syndrom I'm afraid! _pale_

bristolleedsfan

well nationwide informed me on 29th november that all three of my transfer outs "had" been completed.

leek entry shows cheque 29th november 2007
scottish entry shows cheque 6th december 2007

ive emailed both and pointed out nationwides assurance that "in ISA transfers the interest is backdated to ensure no loss is incurred" ( nationwide were referring to transfer outs as well as transfer ins)

ill be interested in when they say interest started to be paid from.

bristolleedsfan

Ian_W wrote: »

Just to add to what Mike says ...
YBS open the account from the day after the the transfer cheque is dated by the previous provider - I know that to be correct.
When I enquired on here about KRBS I was told they pay interest 4 days after they receive the cheque. Their T&C's state that there is a 3 day clearing period where funds are transfered.

" Note: We will pay interest three working days after we receive the funds "

So on that basis I don't think there can be a standardised "no interest loss" rule.

Sorry if you saw part of this post - premature posting syndrom I'm afraid!

interest now gets paid on all savings accounts on the second working day following receipt. ( changed on 30th november)

http://forums.moneysavingexpert.com/showthread.html?p=6907537

YorkshireBoy

Ian_W wrote: »

YBS open the account from the day after the the transfer cheque is dated by the previous provider - I know that to be correct.

Wasn't the case with my last transfer to YBS Ian. The deposit started to earn interest on the day they received the cheque (which was a couple of days after the previous provider sent it).

Halifax used to boast "we will backdate your credit to the day after your previous provider closes your account". Not sure if they still do or not?

Ian_W

bristolleedsfan wrote: »

interest now gets paid on all savings accounts on the second working day following receipt. ( changed on 30th november)

Click the link I posted, it's a cut and paste from KRBS website's

page!!

bristolleedsfan

Ian_W wrote: »

Click the link I posted, it's a cut and paste from KRBS website's

page!!

lots of building societies obviously havent updated their web pages yet clearly what KRBS say doesnt tally with what nationwide told me.

i asked nationwide to transact the transfers out on a monday, which is why they made the statement about no losses of interest on isa transfers.

Mikeyorks

bristolleedsfan wrote: »

interest now gets paid on all savings accounts on the second working day following receipt. ( changed on 30th november)

http://forums.moneysavingexpert.com/showthread.html?p=6907537

Sorry - but I think that's wrong. The 2-4-6 changes are primarily aimed at cheques paid into current / basic ... not savings (and therefore ISA) accounts. It's a bit cryptic, in places, but there's a footnote on the Cheque and Credit Clearing site which says (on the generality of the changes) :-

Not necessarily for savings accounts.

...... and the link you've provided states :-

These changes cover cheques, bankers’ drafts and building society cheques drawn on and paid into a UK current or basic bank account. For saving accounts the maximum time limit for withdrawal is longer (six days instead of four).

- you could read the latter (APACS) quote as implying that only the clearance time for cheques in savings accounts is longer - and the interest times should be co-incidental. But that wouldn't make sense .... and the Cheque / Credit footnote implies there is still an element of Banks self determining how it applies to savings accounts. Bit odd as you could argue ' a cheque is a cheque' whether you pay into a current account or a savings account.

But I noticed the oddity as soon as the detail was published .... and a 2nd read doesn't change any of it i.e. clear a cheque via a savings account ...... and at least 2-4 of 2-4-6 ... does not necessarily apply (depending on your Bank)


Later

Having read it all again - my ref to the footnote is wrong. I took it simply as 'Footnote 3' - but it relates back to the portion of a diagram discussing withdrawal times. I'll read it again tomorrow night - the OH is sounding impatient - so need to go otherwise her interest will only apply on Day 2 as well !!

Ian_W

BLF - Is it all savings accounts OR all savings accounts with clearing banks?

2. The Cheque and Credit Clearing Company (C&CCC) is a membership-based industry body which manages the cheque clearing system in Great Britain. There are 12 members; eleven banks and one building society:
ABBEY NATIONAL
ALLIANCE & LEICESTER
BANK OF ENGLAND
HBOS (HALIFAX AND BANK OF SCOTLAND)
BARCLAYS BANK
CLYDESDALE BANK
The CO-OPERATIVE BANK
HSBC BANK
LLOYDS TSB BANK
NATIONAL WESTMINSTER BANK
NATIONWIDE BUILDING SOCIETY
The ROYAL BANK OF SCOTLAND
All members of C&CCC will be implementing these changes at the end of November.

YorkshireBoy, I'm sure it was you who posted that YBS worked that way but that's certainly what happened when I transfered from A&L to YBS in May. A&L closed on [say] 5th, YBS opened on 6th - even though it took a couple of weeks to show up on the website.

YorkshireBoy

Ian_W wrote: »

YorkshireBoy, I'm sure it was you who posted that YBS worked that way

It was Ian, in this (amongst others) post:
http://forums.moneysavingexpert.com/showpost.html?p=4393960&postcount=22

but that's certainly what happened when I transfered from A&L to YBS in May.

I moved in February. Maybe the process changed in the interim?