Only allowed one new ISA per year?

hildasmuriel

I'm sorry if this is ridiculous - I just can't get me head around it:

I have a fixed rate ISA from the last tax year - due to mature 24 August. 
I'm assuming the rate will then drop to something derisory so I will want to move the money.

I have opened a new ISA already this tax year and cannot transfer anything into it.

Does this mean I cannot move the money from last years ISA because I can't open a second ISA in one year? That the only way to get a decent rate will be to take it out of it's protective ISA wrapping and make it liable to tax on the interest?

eskbanker

No, it doesn't mean that - you can open another cash ISA specifically for prior year money.  The rule is that you can only pay new money into one ISA of each type in any tax year, but transferring prior year money doesn't affect, and isn't affected by, that rule, as long as you use the receiving provider's ISA transfer process to preserve its status....

Doctor_Who

You can open as many cash ISAs as you want for the purpose of transferring previous years' subscriptions, but you can only subscribe (add new money) to one cash ISA in the current tax year. So when the fixed rate ISA matures open a new ISA that accepts transfers-in and do a transfer (just don't add new money).

RetiredTaz

As far as I'm aware, you can open more than one ISA but you can only fund 1 with new money. Maturing ISA's can also be transferred to the ISA you are funding (within their window). I'm sure plenty others around with more knowledge than myself though. 

Zopa_Trooper

If you open a cash ISA, put £20,000 in, can you at a later point in the same tax year transfer that money into a fixed ISA and would it have to be by the same provider?

Doctor_Who

Zopa_Trooper said:

If you open a cash ISA, put £20,000 in, can you at a later point in the same tax year transfer that money into a fixed ISA and would it have to be by the same provider?

Yes you can do a transfer, but it has to be for the whole amount since it's a current ISA (not previous years). You can transfer to any provider that accepts transfers-in.

hildasmuriel

So quick to answer!

Thanks all - I was sure there had to be a simple answer but was getting myself all tied up in knots trying to prove it to myself

Albermarle

I have a fixed rate ISA from the last tax year - due to mature 24 August. 
I'm assuming the rate will then drop to something derisory so I will want to move the money.

The provider of your current fixed rate ISA, should contact you before it matures ( surprised they have not done so yet) and offer you various options. Such as roll it over into a new fixed rate ISA, or move it to an easy access ISA etc. The interest rates on offer may or may not be competitive depending on what that provider is offering at the moment.

If they have not contacted you yet you may be able to see your options on their website assuming you have a password etc.

Personally I would see what they are offering first before looking at a transfer to another provider.

badger09

RetiredTaz said:

As far as I'm aware, you can open more than one ISA but you can only fund 1 with new money. Maturing ISA's can also be transferred to the ISA you are funding (within their window). I'm sure plenty others around with more knowledge than myself though. 

BIB
Only if the new ISA provider allows that. Some don’t allow transfers in.