Confusion over current tax year ISA subscription vs prior tax year ISAs

searching4bestrates

Hi all,

An odd one here. I'm well aware that under current rules one cannot have more than one cash ISA that you have paid into/subscribed in the current tax year and one stocks & shares ISA, with the total value of the subscription not exceeding £20,000.

However, following a phone call I had just now with Shawbrook Bank I'm a little confused and concerned that either I, or one of the banking institutions that holds my ISAs, have done something wrong.

More specifically, I had a number of old ISAs from prior tax years that I consolidated into a single easy access ISA via ISA transfers. This was held with Shawbrook Bank. I then did a partial transfer of this ISA, keeping some of the money in this easy access ISA and some into a fixed rate ISA.

With new money for this tax year I've then opened an easy access ISA with Nationwide, that I then have moved around this year via ISA transfers to various different institutions. In all cases, the full sum of the money was transferred, thereby closing the previous ISA I'd subscribed into. I had understood this to be permissible (you just can't have more than one active cash ISA open at any time into which you've subscribed new money)?

My concern is that when I phoned Shawbrook the person on the phone mentioned that I had an "active" ISA with them, whereas my understanding has been they've only got money from prior tax years. My active ISA in fact sits with Coventry Building Society (CBS).

This has prompted me to be concerned that either a) Shawbrook thinks it has an active ISA with this tax year's money, as well as the active ISA I do have with CBS, and/or b) if this is reported as such to HMRC that I would then be breaching the £20,000 limit, as well as of course the rules on having two ISAs.

The person at Shawbrook wasn't particularly helpful in addressing my concerns, so I just wondered if anyone else had experienced these sorts of issues, particularly when they have undertaken a number of ISA transfers within a given tax year (involving separately, both current tax years and prior tax years money).

Thank you for your help.

mebu60

Did you ask Shawbrook person how much 23/24 new money is in the 'active' ISA? The answer presumably would be zero which is fine. 

hara____

'Active' may not be a problem. I've seen providers use this term to mean you're 'able to add money if you want to' rather than indicating subscriptions have been made. 

Of course, Shawbrook won't know about your CBS account, so to some extent it's reasonable for them to think you might want to subscribe via them this year. The responsibility of only subscribing to one account can really only sit with the customer.

Albermarle

searching4bestrates said:

Hi all,

An odd one here. I'm well aware that under current rules one cannot have more than one cash ISA that you have paid into/subscribed in the current tax year and one stocks & shares ISA, with the total value of the subscription not exceeding £20,000.

However, following a phone call I had just now with Shawbrook Bank I'm a little confused and concerned that either I, or one of the banking institutions that holds my ISAs, have done something wrong.

More specifically, I had a number of old ISAs from prior tax years that I consolidated into a single easy access ISA via ISA transfers. This was held with Shawbrook Bank. I then did a partial transfer of this ISA, keeping some of the money in this easy access ISA and some into a fixed rate ISA.

With new money for this tax year I've then opened an easy access ISA with Nationwide, that I then have moved around this year via ISA transfers to various different institutions. In all cases, the full sum of the money was transferred, thereby closing the previous ISA I'd subscribed into. I had understood this to be permissible (you just can't have more than one active cash ISA open at any time into which you've subscribed new money)?

My concern is that when I phoned Shawbrook the person on the phone mentioned that I had an "active" ISA with them, whereas my understanding has been they've only got money from prior tax years. My active ISA in fact sits with Coventry Building Society (CBS).

This has prompted me to be concerned that either a) Shawbrook thinks it has an active ISA with this tax year's money, as well as the active ISA I do have with CBS, and/or b) if this is reported as such to HMRC that I would then be breaching the £20,000 limit, as well as of course the rules on having two ISAs.

The person at Shawbrook wasn't particularly helpful in addressing my concerns, so I just wondered if anyone else had experienced these sorts of issues, particularly when they have undertaken a number of ISA transfers within a given tax year (involving separately, both current tax years and prior tax years money).

Thank you for your help.

Unfortunately some staff at savings providers are not very well trained, and often give misleading info about ISA rules.

searching4bestrates

Thank you for your replies.

I spent a lot of time going back back through my documentation and am now confident that the comment made by Shawbrook Bank was erroneous when they mentioned the "active" ISA yesterday. Furthermore, given that current year's contributions must be transferred in their entirety, I realised that Shawbrook Bank wouldn't have been able to split the ISA (with prior year's contributions) as has occurred, if it did have current year's contributions in it.

The only cash ISA with current tax year's contributions lies with CBS.

Panic over...! I think.