Splitting a maturing ISA

kitkat68

I have 2 ISAs maturing in February and one will exceed the £85k threshold once the interest is applied - so it needs to be split into 2 accounts ongoing…
what is the best way to manage this - I will want them both to be fixed deals with different institutions to spread the risk…I have another ISA I opened this tax year and will be opening another in April 24…or I can I add the new £20k to one of the 2 I’ll open for the £85k?

I’ve tried searching the forum to research the query but couldn’t find anything that helped me…

refluxer

The best option for the fixed rate ISA you want to split is to ensure that it gets transferred to an easy access ISA when it matures - just make sure it is one that allows partial transfers out. Once that is complete, it's then just a case of opening two new fixed rate ISAs, requesting a partial transfer-in for the first and then (once that is complete) a full transfer of the remainder into the second ISA. 

If your current ISA provider doesn't offer an easy access ISA, then you need to read the T&C's to determine what the maturity options are likely to be. One scenario you'll want to avoid is the automatic transfer into another fixed rate ISA, which is the default option for a number of providers.

As for your 2024-25 ISA allowance, most fixed rate ISAs have a limited funding window (usually 30 days max) so you'd only be able to pay next year's allowance into one you've already opened if the funding window extended into the next tax year. There are a few exceptions to this though - Barclays and Shawbrook are two ISA providers who allow contributions to be made throughout the duration of the fixed rate period.

kitkat68

Thanks for such a thorough reply.
the one that’s going to exceed the threshold is with Leeds BS, the other one is with Shawbrook already and is almost maxed out so don’t want to add to this…
im waiting for Leeds BS to contact me - maybe I could open a other fixed with them
for part of it and transfer the balance to somewhere else - assumingmLweds
have a 5% ish one available?!

kitkat68

Just located the t&cs to see what happens
at at maturity and the account doesn’t mature until 1/4/24 - I opened it mid Feb 23 and it was a 12m fixed, just shows I didn’t spot the extended time on it 🤣
but the good news is it is transferred to an easy access isa at maturity!