Confused - ISAs - One of the Banks talking nonsense it seems :/

jr941

Interesting. I was about to complete the transfer form which I may not submit now.

I still want to know the following for my knowledge. This is from the form:

''

''If you have subscribed to this ISA for the current tax year, do you want to include the subscription for the current year?

Choose an Option Yes No Is the current answer yes here?

The amount in your account representing the current tax year subscription can only be transferred in whole and not in part.'' .... Do I need to say yes to the last question? Subscription Year Does the ISA you wish to transfer have a notice period? *   Yes   No  If yes, a notice period is required for closure / part transfer of the existing ISA, I give my consent to: This information is required if 'Yes' is chosen for Does the ISA you wish to transfer have a notice period? The other two options are: Serve the full notice period before this instruction can be processed Yes or No   Proceed immediately with the transfer and apply any penalty which may occur Yes or No ... I am assuming I am still within the 28 days period with Co-Op so they should not impose a penalty and do an immediate transfer. Is yes, this 'seems' to the best option. Please correct me if I am wrong. The Natwest adviser also asked me to do this 'formal transfer thing via the form' yesterday  Thanks!

eskbanker

What do you believe to be the significance of 28 days?

jr941

I have no clue. This is my first time ever dealing with this.

Is the 28 day period of no use in this case at all? I transferred the money to the Co-Op only yesterday though. I think this fixed deposit account ISA was opened on 14th Dec 23 with zero balance until yesterday

eskbanker

I don't see any relevance of a notional 28 day period - based on what I see in their terms, there's a cooling-off period of "14 calendar days from the date the account is opened or upon receipt of your welcome letter, whichever is later", within which you can cancel the ISA, but any access to the money thereafter, whether withdrawal or transfer, entails a penalty charge equivalent to 180 days loss of interest, so this would be applied if you were to do anything now.

When did you receive the welcome letter?

jr941

Probably on 20th Dec, not sure. I am on the phone with Co-Op again. Hold time is likely to be very long once again.

I had to top-up to buy more minutes to make this phone call. I ended up using my monthly 300 minutes allowance on these phone calls to the two banks already. I just cannot believe things can be this challenging in this realm of banking

eskbanker

jr941 said:

Probably on 20th Dec, not sure. I am on the phone with Co-Op again. Hold time is likely to be very long once again.

When you get through to them, make sure you establish definitively whether or not the account is still within its cooling-off period - I can't see any point in discussing notional 28 day periods that aren't reflected in any terms or rules....

eskbanker

jr941 said:

I wonder if anyone has ever contemplated suicide or pulled the plug while getting their head around this. I am still on hold but I am having such thoughts. It's like I cannot focus on anything else apart for this.

I'd suggest stepping back and taking your time to reflect on things rather than letting it overwhelm you and feeling the need to do something urgent - it's true that there may be a very limited window of opportunity to cancel the Co-Op account if it turns out to be within its cooling-off period, but if it turns out not to be (as seems likely) then there's no point in rushing around getting worked up about all this, so taking more time to consider options at leisure will make more sense IMHO.

jr941 said:

To my understanding, we can earn up to £1000 in interest income. Is this correct, if we are taking the non-ISA route and not making more than £1 k in interests overall via savings account/s? 

If you earn other income of between about £17.5K and £50K then up to £1K of savings interest from non-ISA accounts is taxed at 0%.  There's plenty of information about this on the forum and elsewhere on the site but, as above, take your time mulling it over and researching before acting:

https://www.moneysavingexpert.com/savings/tax-free-savings/

jr941

So far, Co-Op has said they cannot even do the transfer since the 14 days have passed as it is a fixed deposit account. I am put on another long hold again. They are trying to find a way out I think ..

If they cannot move the funds, is HMRC going to be understanding in the worst case scenario? Because I have really tried everything to fix this grr

Should I ask the bank to email HMRC and tell them the situation which cannot seemed to be fixed anymore

jr941

I am done with another long phone call with Co-Op. 

The money cannot be transferred since it is a fixed deposit account.

If anything is enforced then I will be losing out on 180 days of interest on the total amount. 

What are the consequences for me breaching the Natwest's terms and conditions of Help to buy ISA?

I was not aware of this when I opened this second Cash ISA account. I really feel like banging my head against the wall

Is it better for me to simply close the Natwest one - This one is still in its cooling off period. 

This way I will not be over my 20 k allowance by a £1000.

Happy to deal with the penalty of breaching the condition of Help to Buy ISA, if it is nothing major .. what is the penalty though?

eskbanker

jr941 said:

So far, Co-Op has said they cannot even do the transfer since the 14 days have passed as it is a fixed deposit account. I am put on another long hold again. They are trying to find a way out I think ..

If they cannot move the funds, is HMRC going to be understanding in the worst case scenario? Because I have really tried everything to fix this grr

Should I ask the bank to email HMRC and tell them the situation which cannot seemed to be fixed anymore

No, there's no point in contacting HMRC, there's nothing they can or will do until they've received the year-end submissions from the providers, after which they'll decide whether any action is needed, without any further input from saver or institution, although it remains doubtful that anything will happen here.

jr941 said:

I am done with another long phone call with Co-Op. 

The money cannot be transferred since it is a fixed deposit account.

That's patently untrue, as confirmed by their terms:

Transferring out – You can transfer part or all of your Fixed Rate Cash ISA to another provider at any time. Fixed Rate Cash ISAs have restrictions which means you will incur a charge or loss of interest.

jr941 said:

What are the consequences for me breaching the Natwest's terms and conditions of Help to buy ISA?

I was not aware of this when I opened this second Cash ISA account.

[...]

Happy to deal with the penalty of breaching the condition of Help to Buy ISA, if it is nothing major .. what is the penalty though?

Opening and paying into a Co-Op cash ISA after funding your HTB ISA isn't actually a breach of the HTB terms as such, i.e. it's funding the second ISA that breaches the ISA rules and its own terms.

jr941 said:

Is it better for me to simply close the Natwest one - This one is still in its cooling off period. 

This way I will not be over my 20 k allowance by a £1000.

I don't believe you've mentioned that you've exceeded your £20K limit as well as contravening the rules about multiple ISAs, so if you have a non-HTB NatWest cash ISA that's still within its cooling-off period then yes, cancelling it would be sensible if that brings you back within your annual contribution limit.