IFA mistake. What do I need to be aware of?

milleniumaire

dunstonh said:

So, to confirm I understand you, the £5K you refer to is the increase in value of the assets within the ISA over the 10 days.  You are saying an "additional" £5K will need to be placed in the ISA in order to purchase the "missing" units and this £5K will reduce my ISA allowance for this tax year.

If I understand you correctly, that is a very good point as I have essentially lost £5k of this years ISA allowance through no fault of my own.  How does an IFA recompense for this loss of allowance?

Can you clarify.... 
Did the sale of units happen in the GIA or the ISA?

If you are doing bed & ISA, you sell down in the GIA.  You don't sell down in the ISA.    Just checking this in case its a typo.

If you are not using £2000 of dividends allowance each year, then you are no worse off by having that £5k in the GIA.  It can also depend on your interest paying investments as they go towards the PSA and you have £1000 (or potentially £500).

I can confirm the sale of units happened in the ISA.

All the IFA was supposed to be doing was a bed and ISA, so moving some investments into the ISA.  Somehow, they haven't actually explained how, they managed to sell ALL assets in my ISA!

I work through a Limited Company and so receive dividends from my company, meaning I easily exceed the £2K dividend allowance each year.  It is more likely any assets that I am now unable to move into the ISA will result in dividends taxed at 40%.

dunstonh

milleniumaire said:

dunstonh said:

So, to confirm I understand you, the £5K you refer to is the increase in value of the assets within the ISA over the 10 days.  You are saying an "additional" £5K will need to be placed in the ISA in order to purchase the "missing" units and this £5K will reduce my ISA allowance for this tax year.

If I understand you correctly, that is a very good point as I have essentially lost £5k of this years ISA allowance through no fault of my own.  How does an IFA recompense for this loss of allowance?

Can you clarify.... 
Did the sale of units happen in the GIA or the ISA?

If you are doing bed & ISA, you sell down in the GIA.  You don't sell down in the ISA.    Just checking this in case its a typo.

If you are not using £2000 of dividends allowance each year, then you are no worse off by having that £5k in the GIA.  It can also depend on your interest paying investments as they go towards the PSA and you have £1000 (or potentially £500).

I can confirm the sale of units happened in the ISA.

All the IFA was supposed to be doing was a bed and ISA, so moving some investments into the ISA.  Somehow, they haven't actually explained how, they managed to sell ALL assets in my ISA!

I work through a Limited Company and so receive dividends from my company, meaning I easily exceed the £2K dividend allowance each year.  It is more likely any assets that I am now unable to move into the ISA will result in dividends taxed at 40%.

Get them to pay you £5000 (or whatever it is) directly.  You draw £5000 less from the company and instead make an employer contribution to the pension from the company.    That will reduce your corporation tax & dividend tax and more than make up for the loss of ISA position.

milleniumaire

dunstonh said:

Get them to pay you £5000 (or whatever it is) directly.  You draw £5000 less from the company and instead make an employer contribution to the pension from the company.    That will reduce your corporation tax & dividend tax and more than make up for the loss of ISA position.

Thanks for the interesting idea.  When they are in a position to discuss how they are going to resolve the issue I will chat with them about this idea.