ISA Transfer Confusion

Kynthia

I'm a little confused about the rules about paying into two ISAs of the same type in the same year.

I've been paying into a S&S ISA all year. Interactive Investor are offering cash back to people who open a new ISA with them before 29th Feb. I assumed I could transfer in my S&S ISA that I've been paying into all year, as I couldn't open one with ii and pay money in this year while keeping my existing one that i had paid into.

Am I wrong? Am I only able to transfer an ISA I hadn't contributed to this year?

eskbanker

Up until the forthcoming rule change for 2024/25, you can only pay new money into one ISA of each type in any tax year, so if you've paid into a S&S ISA already then your options are either to continue to fund that one or to transfer it (including all current year money) to II, which is allowed, as long as you use II's ISA transfer process.

j_netprofit

eskbanker said:

Up until the forthcoming rule change for 2024/25, you can only pay new money into one ISA of each type in any tax year, so if you've paid into a S&S ISA already then your options are either to continue to fund that one or to transfer it (including all current year money) to II, which is allowed, as long as you use II's ISA transfer process.

Just to be clear here....am I right in saying you can have multiple:

Cash ISAs
SAS ISAs
LISAs

However you can only pay into one of each kind a year? Again sorry to spell this out in layman's terms but just so I understand also...

If I have a Cash ISA with HSBC/Barclays/Natwest I can only pay into one of those? The same goes with the other two ISAs.

Effectively if I wanted to put a bit into all of however many ISAs I had, I could actually only pay into one of those three kinds?

Thanks and sorry for hijacking thread.

eskbanker

Yes, as stated, until April "you can only pay new money into one ISA of each type in any tax year", although you can have more than that.

Edit: some providers allow 'split ISAs' that allow you to fund multiple cash ISAs within the same institution concurrently:

https://www.moneysavingexpert.com/savings/best-cash-isa/#accordion-content-620297425-5

Kynthia

eskbanker said:

Up until the forthcoming rule change for 2024/25, you can only pay new money into one ISA of each type in any tax year, so if you've paid into a S&S ISA already then your options are either to continue to fund that one or to transfer it (including all current year money) to II, which is allowed, as long as you use II's ISA transfer process.

Thank you. So to be clear I'm fine to transfer an ISA from Hargreaves Lansdown I've been contributing to this year and had for many years, and then continue contributing to it once the transfer to ii is complete using their transfer services? It counts as one S&S ISA for the year.

eskbanker

Kynthia said:

eskbanker said:

Up until the forthcoming rule change for 2024/25, you can only pay new money into one ISA of each type in any tax year, so if you've paid into a S&S ISA already then your options are either to continue to fund that one or to transfer it (including all current year money) to II, which is allowed, as long as you use II's ISA transfer process.

Thank you. So to be clear I'm fine to transfer an ISA from Hargreaves Lansdown I've been contributing to this year and had for many years, and then continue contributing to it once the transfer to ii is complete using their transfer services? It counts as one S&S ISA for the year.

Yes, when transferring current year contributions via the defined ISA transfer process, they're treated as if they'd been made to the new ISA in the first place, so the new ISA is then regarded as the current year one.

Kynthia

eskbanker said:

Kynthia said:

eskbanker said:

Up until the forthcoming rule change for 2024/25, you can only pay new money into one ISA of each type in any tax year, so if you've paid into a S&S ISA already then your options are either to continue to fund that one or to transfer it (including all current year money) to II, which is allowed, as long as you use II's ISA transfer process.

Thank you. So to be clear I'm fine to transfer an ISA from Hargreaves Lansdown I've been contributing to this year and had for many years, and then continue contributing to it once the transfer to ii is complete using their transfer services? It counts as one S&S ISA for the year.

Yes, when transferring current year contributions via the defined ISA transfer process, they're treated as if they'd been made to the new ISA in the first place, so the new ISA is then regarded as the current year one.

That's great, thank you. I thought logically that had to be the case as otherwise you would only have transfers at the start of each tax year, but I would hate to fall foul of the rules.