Wealthify cashback

Compound_2

A Wealthify £50 cashback offer is on the MSE latest tips. Doing a £50 partial ISA transfer from an old cash ISA would avoid any interference with current year allowances and it seems to be an option on the link. The terms state the £50 cashback will be paid into the plan, or your bank account if that's not possible. The cashback would count as ISA subscription so 12 months on how will Wealthify know if this is alllowed? If you put £20000 in the plan next year, clearly no more is allowed. But if you've paid in less, how do they the know whether you've used up the 20k allowance across cash/lifetime ISAs? And if you put just £1 of new money into a different S&S ISA, anything added to the Wealthify plan would breach the 'one of each type' per year rule. The Wealthify plan could be potentially unsuiable to use as a main S&S ISA, not only being more expensive but your selected risk profile could be different for significant amounts of your own money verus £50 with cashback.

Searching the forum, I see this offer has appeared before but people had problems with Wealthify telling them they didn't qualify. It seems that it's too good to be true, although ironically the MSE email describes it as 'frankly a ridiculous deal'. What do people here make of the new offer?

Band7

Just do it as a normal GIA and don't bother with an ISA. The gains you will make will almost certainly not count as taxable income but as Capital Gains. The CGT allowance would cover then gains you can make from £100 over a year.

masonic

Compound_2 said:

A Wealthify £50 cashback offer is on the MSE latest tips. Doing a £50 partial ISA transfer from an old cash ISA would avoid any interference with current year allowances and it seems to be an option on the link. The terms state the £50 cashback will be paid into the plan, or your bank account if that's not possible. The cashback would count as ISA subscription so 12 months on how will Wealthify know if this is alllowed?

Other than the case where you've already subscribed £20k to your Wealthify S&S ISA (and it just wouldn't be moneysaving to put £20k into a Wealthify S&S ISA), they wouldn't know. Having put in £20k already is probably what the "or your bank account if that's not possible" clause relates to. If the money is to be paid into the ISA as a subscription in all other cases, then you are responsible for ensuring that you don't exceed £20k across all ISAs you hold and that you don't subscribe to a different S&S ISA in the same tax year that you subscribe to a Wealthify S&S ISA. If it is the same as the previous offer, the cashback will be paid after a year, so it will be a subscription in the 2023/24 tax year if added to the ISA.

As Band7 says above, opening a general investment account avoids all of the ISA-related difficulties.

Compound_2 said:

Searching the forum, I see this offer has appeared before but people had problems with Wealthify telling them they didn't qualify. It seems that it's too good to be true, although ironically the MSE email describes it as 'frankly a ridiculous deal'. What do people here make of the new offer?

To qualify for cashback, it is necessary to meet the qualifying criteria. Several people have complained that Wealthify told them they didn't apply via the MSE affiliate link. Had they done so, they would have received an email stating that they had signed up for the cashback offer, which they could have used to prove to Wealthify that they did. It is possible that security settings/software on their device prevented the link from tracking, as can happen with other referral links, or the individual concerned did not click through using the correct link. If you reach the point where you are being asked to fund your account and you haven't had confirmation of the cashback offer, then something has probably gone wrong. If I remember correctly, the cashback offer was also displayed in a banner during application as well.

Compound_2

Thanks, I agree that Wealthify ISA isn't the right way forward. However, as an alternative to the GIA, what about the listed option of a personal pension? If your occuptional pension is modest, limits shouldn't be a concern and you could get £25 basic tax relief if you don't mind locking your £100+ till age 57. If you're thinking of withdrawing after 12 months in GIA, even the Cautious Plan advises a 5 year minimum term with probabilty of loss after one year, although this doesn't account for the cashback.

With the personal pension there would still be the option to remove money from Wealthify after 12 months by transferring to another pension provider. What are people's thoughts on this and how does it affect which fund you should choose?

masonic

I would say that involves more hassle and generally wouldn't make sense. However, if you have other unwrapped investments generating reportable capital gains (such that you must provide detailed calculations to HMRC), then it may be worth it, as Wealthify carry out lots of transactions over the year, selling units to cover their fees, which would be a pain to work through. The majority of people need not worry about these as their gains will be well below the declarable limit.

The holding period should not generally be a concern, because after a year you can just bed and ISA from the GIA to your preferred S&S ISA.

razord

I did this offer early last March, so my bonus is due to be paid this March.

The cash back is paid into your plan, so you need to make sure that a) you don't take out another S&S ISA next year and b) you keep £50 of your £20k allowance next year.

They have no way to know what your allowance is at other providers, so it's kinda on you. I asked them if I could opt to pay to my bank account as I have used up my allowance and they said no...

I assume the reason they do this is to basically keep you locked into their S&S ISA for at least a year, and 2 tax years.

Compound_2

masonic said:

The holding period should not generally be a concern, because after a year you can just bed and ISA from the GIA to your preferred S&S ISA.

Is it possible to Bed and ISA across providers, especially the cheapest? Wealthy's portfolios seem unique.

razord said:

I assume the reason they do this is to basically keep you locked into their S&S ISA for at least a year, and 2 tax years.

How about if one delayed the ISA transfer form till 6 April? T&C just required creating plan in February then funding by August, helpful if you have to wait for a penalty-free withdrawal. Then the £50 cashback is paid at the start of the 2024-25 year. Account holder is free to transfer from Wealthify to another provider with full use of allowance there. I could even leave my 'past year' £50 in Wealthify ISA to run for the recommened 5 year term, taking just their 'current year' £50 elsewhere.

razord

Compound_2 said:

razord said:

I assume the reason they do this is to basically keep you locked into their S&S ISA for at least a year, and 2 tax years.

How about if one delayed the ISA transfer form till 6 April? T&C just required creating plan in February then funding by August, helpful if you have to wait for a penalty-free withdrawal. Then the £50 cashback is paid at the start of the 2024-25 year. Account holder is free to transfer from Wealthify to another provider with full use of allowance there. I could even leave my 'past year' £50 in Wealthify ISA to run for the recommened 5 year term, taking just their 'current year' £50 elsewhere.

Good question... can you create a plan without any funding? For me, I got an email after the funding to say the account was now open... so it's possible the year timer will start from that day?

masonic

Compound_2 said:

masonic said:

The holding period should not generally be a concern, because after a year you can just bed and ISA from the GIA to your preferred S&S ISA.

Is it possible to Bed and ISA across providers, especially the cheapest? Wealthy's portfolios seem unique.

They are building a global fund of funds portfolio, similar to HSBC Global Strategy et al, so you could pick something broadly equivalent and not fall foul of a short investment horizon. Admittedly it is easier for self-select providers.

sparky0138

FYI, for anyone with a Wealthify account, their Refer A Friend reward is currently £100 for you and £100 for your friend (first 4,000 people who register).

You can find your personalised link on your dashboard under Refer A Friend.

Compound_2

razord said:

Good question... can you create a plan without any funding? For me, I got an email after the funding to say the account was now open... so it's possible the year timer will start from that day?

The application allows you to 'skip for now' the ISA declaration. However, the effect is that no ISA is opened even though an application to subscribe would appear unnecessary for a transfer. If you apply to subscribe, perhaps you can 'skip for now' on the transfer/deposit as the financial details may not be to hand?

I wonder if for tax purposes if the reward is properly considered a capital gain? If so, as part of an ISA it shouldn't count as a subscription.