CASH ISA QUESTION

TOMHAYDOCK

Hi

 First question on here so be kind.....

 Lucky enough to have a long long standing cash ISA that in its current form matures again in October 23 & will then have circa £93k in it so yes will now be over the £85K max I am covered for in a single cash ISA.

   I did take out a new 1 year fixed ISA in April 23 & put in it the now max £20K.

So question is can I open another cash ISA either fixed or easy access in October23 , to put just the the circa £8k ISA savings into to avoid having over £85K in there .

Or am I stuck that I would have to either run a risk on the £8k in taking out another fixed term ISA, or moving the £8k out of an ISA savings plan till a new tax year starts in April 24?

  Thanks

Tom

Catplan

You can do a partial transfer assuming that’s allowed, just pick one that accept partial transfers.

masonic

You could partially transfer some of the previous year contributions to a different ISA, but as you've fixed you will likely pay a penalty to do so.

TOMHAYDOCK

The one that matures in Oct 23 was previously with the same Bank as a 2 year fixed( from Oct 20 to Oct 22)  we took a 1 year with them as it was the best rate out there at that time.

We did not add any extra funds into it in Oct 22 just left the amount plus interest go again for another year.

 I know you can only open & put in max £20k new money into an ISA in a tax year.I am not clear if its existing ISA money, if it could go into a new ISA  even though I have already opened & put £20K into an ISA in this tax year.

Or what options I have?

Thanks

Tom

badger09

You can open as many Cash ISAs as you like but can only pay new money (which you’ve already done) into one 

Basically, HMRC allow you to do what you like with the £93k ISA as it all relates to previous years’ subscriptions. 
If you’re happy to wait until it matures in October, make sure it matures into an instant access product, rather than another fixed term by default. When it matures, you need to open a new ISA with another provider & ask them to xfer in whatever amount you decide on.  I’d suggest this should be more than 8k to allow for interest growth on the remaining £85k to stay within FSCS cover. Just don’t add any new money to that new ISA. 
If you swish, you could open 2 new ISAs with different providers & xfer say £50k to 1 & £43k to the other, or whatever split you decide. 

If you’re nervous about going over the £85k limit, check the T&Cs of your current ISA for penalties before making any hasty decisions. 

Albermarle

There is a sub forum specifically about ISA's where you will find many similar questions and answers about ISA rules. So probably worth a look through.
ISAs & tax-free savings — MoneySavingExpert Forum

TOMHAYDOCK

Many thanks for all your help

Tom