Can I keep funding my EASY ACCESS ISA after opening & transfering to a new FIXED ISA account

NipTuck

Sorry if this has been asked & answered before - had a quick look and can't find anything..

I currently have a Virgin "Easy Access Cash ISA Exclusive @ 4.51%" of which I have paid £13,000 into this year

Today I opened the "2 Yr Virgin Fixed Rate E-ISA @ 5.62%" and requested to transfer the FULL total of my Easy Access Cash ISA account into this account

My question is:  Can I continue to fund the "Easy Access Cash ISA Exclusive" account with the £7,000 remaining allowance -- or would this be classed as funding 2 accounts?

Thanks in advance

refluxer

When you say 'this year', do you mean this tax year ? If so, you would be funding two different cash ISAs at once with new subscriptions during the current tax year so that wouldn't be allowed.

All (past and future) subscriptions from the current tax year have to stay together in one cash ISA, unless the provider offers a 'portfolio' approach which allows you to spread it over their different cash ISA accounts.

The new Virgin ISA is likely to have a limited funding window, so you will lose the ability to pay the remaining £7k into it once you get past that (unless you were to transfer out before the end of the tax year, but that would obviously incur a penalty so is best avoided).

NipTuck

The £13k has been added in this tax year

The full amount (£100k+) will be transfered to the new FIXED RATE ISA

Would this be just classed as a transfer (as it is not new cash)

Would I then be able to continue to fund the old ISA the remaining £7k

or would I have to place it into my Savings account then transfer in the next tax year?

refluxer

The issue is that £13k of it is 'new money', which is why you won't be able to continue to fund the old easy access ISA with the remainder of your 2023-24 allowance as that would break ISA rules. 

refluxer

What you maybe should have done was to do a partial transfer and transfer all but £13k. That would then leave this tax year's subscriptions in the easy access ISA and allow you to continue to contribute to it, up to the £20k allowance.

NipTuck

Arrr - I think I understand now

I have 30 days from today to carry on funding the new Fixed ISA

After that I will use my Savings account - then transfer into the Easy Access ISA in the 2024-25 tax year

Thanks for clarifying the ISA rules

Doctor_Who

NipTuck said:

Sorry if this has been asked & answered before - had a quick look and can't find anything..

I currently have a Virgin "Easy Access Cash ISA Exclusive @ 4.51%" of which I have paid £13,000 into this year

Today I opened the "2 Yr Virgin Fixed Rate E-ISA @ 5.62%" and requested to transfer the FULL total of my Easy Access Cash ISA account into this account

My question is:  Can I continue to fund the "Easy Access Cash ISA Exclusive" account with the £7,000 remaining allowance -- or would this be classed as funding 2 accounts?

Thanks in advance

If you do a full ISA transfer from the EA cash ISA (that you have subscribed to this tax year) to the fixed rate cash ISA then my understanding is that the EA cash ISA will then be closed. Hence you won't be able to continue funding the EA cash ISA. You might be able to quickly add the £7K to the EA cash ISA if you only initiated the transfer today, and this should then be transferred to the fixed rate ISA as part of the full transfer.