ISA transfer confused

Simp21

Hi All

I've read through a lot of posts and I'm still confused, please could someone clarify.

Would this be allowed?

All cash ISAs

Existing ISA A transferred to new ISA B with same provider,  no contributions for current year in A or intention to make to B.

Existing ISA C transferred to new ISA D with different provider,  no contribution for current year in C , intend to use existing year allowance to add to D.

I keep seeing that you can only open one of each type of ISA a year which seems to say not but other posts seem to say its OK as long as you only contribute to one.

Many thanks

HappyHarry

That would be fine.

You can only contribute new money to one cash ISA per tax year. Transferring an ISA does not count as contributing.

Edit: Many places say that you can only open one Cash ISA per year. This is incorrect.

Albermarle

I keep seeing that you can only open contribute new money to one of each type of ISA a year which seems to say not but other posts seem to say its OK as long as you only contribute to one.

See insert in italics. Apart from that rule you can open as many ISA's of any type as you like.

isasmurf

The reason that some places say you can only open 1 ISA is because the regulatory definition of opening an ISA is different to what open usually means when it comes to opening an account. An ISA is not open until it has received a valid subscription.  This difference in definitions exists because technically an ISA is a tax wrapper and not the bank account itself, although in many banks they are treated as one and the same thing.



From HMRC ISA managers guidance notes

Before a manager can open an ISA that an investor has applied for, they must hold all of the following:

• a valid application, which he has accepted (see signature)
• a valid ISA subscription
• the date on which the ISA manager accepts the application form
• the date on which the subscription is made (see date of subscription)

A manager may accept an application before a subscription is made, but the ISA does not begin until a subscription is made.

So when you open an account to receive an ISA transfer from previous years subscriptions this does not constitute opening an ISA because your not making a subscription.  (Where subscription means putting money into.)

I note the official government taxpayer facing guidance has moved away from the "open" terminology and now says "You can put money into one of each kind of ISA each tax year."  

Simp21

Thank you for the responses,  much appreciated 

Pmatty

HappyHarry said:

That would be fine.

You can only contribute new money to one cash ISA per tax year. Transferring an ISA does not count as contributing.

Edit: Many places say that you can only open one Cash ISA per year. This is incorrect.

So,technically you could open a new isa in April,max that out with 20k,then open let's say 2 more isa's and part transfer previous years isa's into these as long as you don't contribute to them (apart from the transfer)

Rusty190

Pmatty said:

HappyHarry said:

That would be fine.

You can only contribute new money to one cash ISA per tax year. Transferring an ISA does not count as contributing.

Edit: Many places say that you can only open one Cash ISA per year. This is incorrect.

So,technically you could open a new isa in April,max that out with 20k,then open let's say 2 more isa's and part transfer previous years isa's into these as long as you don't contribute to them (apart from the transfer)

Yes - technically - providing all banks/building societies concerned allow partial transfers out and in.