New ISA rules April 2024

AlwaysLearnin

Malchester said:

Just spoken to. Paragon. You can fund more than 1 ISA with them in a year but not with them and another bank. I asked how they were going to police this and the agent said they couldn't. I asked what was the point in having their ISA declaration if it couldn't be policed she couldn't answer. She said she was just answering my question with her script

I guess that when HMRC receive information at the end of the financial year and more than one ISA has been subscribed they will do nothing as no rules have been broken 

Perhaps her script said something along the lines of "If you don't know the actual answer to a question, always answer to the negative, so that we can't be held accountable for recommending a specific action"....?

Carl13

Have just received an "official" response from Shawbrook for anyone considering using them for an investment less than the 20K yearly allowance.

"This is still being reviewed by the FCA and we are currently not taking part in this. The change is currently optional and is not mandatory for all ISA providers. Our current stance on this is that a customer can only hold one ISA account per tax year. This does mean if you wish to hold another ISA with another provider we would then kindly request you to close your ISA with us or the other provider. 

Apologies for any inconvenience."

Rich2808

Carl13 said:

Have just received an "official" response from Shawbrook for anyone considering using them for an investment less than the 20K yearly allowance.

"This is still being reviewed by the FCA and we are currently not taking part in this. The change is currently optional and is not mandatory for all ISA providers. Our current stance on this is that a customer can only hold one ISA account per tax year. This does mean if you wish to hold another ISA with another provider we would then kindly request you to close your ISA with us or the other provider. 

Apologies for any inconvenience."

Shawbrook's rules don't trump the rules approved by parliament.

They can of course permit people to only open and pay into one cash isa (with 2024-25 new funds) with them - they can also refuse to accept partial or full transfers in of 2024-25 isa funds. Perfectly fine - in terms of your relationship with them as their customer.

They cannot prevent you opening a second (or multiple) cash isa with another provider - that is within the law and frankly as long as you don't invest more than £20k in 2024-25 in total across all providers none of their business.

Of course you may wish to consider if you wish to invest with providers who take this stance. Because the government decides the ISA rules - not Shawbrook!! As it is unacceptable for them to insist on things they have no power to insist on that involve investments with other isa providers within the statutory rules approved by the government and parliament.

https://www.gov.uk/government/publications/tax-free-savings-newsletter-11/tax-free-savings-newsletter-11

This does seem to be something Mr Lewis may wish to take forward - and raise it in the media/with the Chancellor. Because this is frankly unacceptable.

masonic

Carl13 said:

Have just received an "official" response from Shawbrook for anyone considering using them for an investment less than the 20K yearly allowance.

"This is still being reviewed by the FCA and we are currently not taking part in this. The change is currently optional and is not mandatory for all ISA providers. Our current stance on this is that a customer can only hold one ISA account per tax year. This does mean if you wish to hold another ISA with another provider we would then kindly request you to close your ISA with us or the other provider. 

Apologies for any inconvenience."

I would strongly encourage you to make a formal complaint that their advice is unfair and escalate to the Financial Ombudsman Service at the earliest opportunity.

TheWoodler

Quite. MrWoodler has his 2023-4 ISA with Shawbrook and when it matures he’ll be transferring it out as neither of us has the patience for this nonsense. As customers we can vote with our feet (or £)! 

The_Green_Hornet

Malchester said:

Just spoken to. Paragon. You can fund more than 1 ISA with them in a year but not with them and another bank. I asked how they were going to police this and the agent said they couldn't. I asked what was the point in having their ISA declaration if it couldn't be policed she couldn't answer. She said she was just answering my question with her script

I guess that when HMRC receive information at the end of the financial year and more than one ISA has been subscribed they will do nothing as no rules have been broken 

I have just received my Confirmation Certificate from Paragon for a recently opened Cash ISA and there is no mention of this restriction.

The declaration only states that "I have not subscribed, and will not subscribe, to more than the overall ISA subscription limit total in the same tax year".

I suggest the person you spoke to at Paragon is reading from an outdated script.

Beddie

TheWoodler said:

Quite. MrWoodler has his 2023-4 ISA with Shawbrook and when it matures he’ll be transferring it out as neither of us has the patience for this nonsense. As customers we can vote with our feet (or £)! 

That's an overreaction, don't you think? The reply above from Shawbrook shows they are still in a muddle with understanding the new rules. It can be safely be ignored, as they can have no say whatsoever on how many ISAs you open with other providers.

Beddie

The_Green_Hornet said:

Malchester said:

Just spoken to. Paragon. You can fund more than 1 ISA with them in a year but not with them and another bank. I asked how they were going to police this and the agent said they couldn't. I asked what was the point in having their ISA declaration if it couldn't be policed she couldn't answer. She said she was just answering my question with her script

I guess that when HMRC receive information at the end of the financial year and more than one ISA has been subscribed they will do nothing as no rules have been broken 

I have just received my Confirmation Certificate from Paragon for a recently opened Cash ISA and there is no mention of this restriction.

The declaration only states that "I have not subscribed, and will not subscribe, to more than the overall ISA subscription limit total in the same tax year".

I suggest the person you spoke to at Paragon is reading from an outdated script.

At last, some sense! The other providers will all sort their paperwork out too, soon enough. They are just being cautious and dragging their feet, as they so often do. Anyone who has worked in banking will know the culture.

I'd completely ignore any conditions that don't tally with the new rules and follow the rules announced by the Government.

TheWoodler

Beddie said:

That's an overreaction, don't you think? The reply above from Shawbrook shows they are still in a muddle with understanding the new rules. It can be safely be ignored, as they can have no say whatsoever on how many ISAs you open with other providers.

Well no, it’s not - when other providers are getting it right already. The customer is king after all, the customer has more choice than ever before, and each customer has the right to make their choices based on their perceptions of banking behaviour. For example, you may not wish to save with traditional banks for green reasons, or you may prioritise good customer service, retention of branches, or accessible practices or support for Women in Banking initiatives or a myriad of other things.

Consumer behaviour and trends will show the winners and losers in this market: it will speak for itself. 

masonic

The main concern is that others will be told the same thing and will not be as savvy as the readers of this forum, so may lose out as a result. There's no excuse for providers making categorical statements about ISA rules that are false. They should direct customers to HMRC for advice if they don't know.