ZOPA Smart ISA - transfers in experiences?

boco803

From what I've gleaned, ZOPA's Smart ISA is a decent proposition as long as you don't mix & match their variable and fixed ISAs as they don't allow partial transfers (that is, transferring out from easy access variable ISA will also involve the closure and penalty for a fixed ISA).

I intend to transfer in a couple of maturing ISAs with Santander and Nationwide - has anyone had recent experiences of this with ZOPA? 

I already have their Smart Saver, so applying for the Smart ISA shouldn't be an issue.  Then once the ISA account has been opened, I guess it's just going to the relevant section to request transfers in? 

I also assume there's an option to transfer once any fixed terms have matured?

Thanks for sharing any experiences.

typeanonspare

They also don't allow partial transfers out though which concerns me.

I have also shortlisted Zopa alongside Trading 212 and can't decide which one to go for. But the partial transfer restriction of Zopa could end up being a deal breaker.

E.g. Say I have £30k in my Zopa ISA, but wish to transfer out £10k for an emergency purchase. I have to withdraw all £30k, despite only wanting £10k.

I would then need to find a new provider to transfer all of the funds to, thus using up my year's allowance.

Could be even worse if I had say £60k in a Zopa ISA, and needed to withdraw £15k. I now have £60k sat in my bank - how do I get this bank into an ISA?

Or am I missing an easy workaround/method here?

refluxer

typeanonspare said:

They also don't allow partial transfers out though which concerns me.

I have also shortlisted Zopa alongside Trading 212 and can't decide which one to go for. But the partial transfer restriction of Zopa could end up being a deal breaker.

E.g. Say I have £30k in my Zopa ISA, but wish to transfer out £10k for an emergency purchase. I have to withdraw all £30k, despite only wanting £10k.

I would then need to find a new provider to transfer all of the funds to, thus using up my year's allowance.

Could be even worse if I had say £60k in a Zopa ISA, and needed to withdraw £15k. I now have £60k sat in my bank - how do I get this bank into an ISA?

Or am I missing an easy workaround/method here?

I think you might need to differentiate between withdrawals and transfers ?

If you needed some of the money temporarily and had it in a Smart ISA Access pot, then you could withdraw it and you'd be able to replace it before the end of the tax year without it counting again towards your ISA allowance, because the Access ISA pot is flexible. There are no restrictions on withdrawals from an Access pot, as far as I'm aware.

If you wanted to transfer any of the ISA money away to a new ISA provider, then yes - you'd have to transfer all the different pots you hold within the Smart ISA at once, which means paying a penalty for breaking any Fixed Term pots that you have running.

I currently have a 2 year Fixed Term cash ISA pot with Zopa and won't be opening an Access pot or any further Fixed Term pots, due to the transfer restriction.

typeanonspare

refluxer said:

typeanonspare said:

They also don't allow partial transfers out though which concerns me.

I have also shortlisted Zopa alongside Trading 212 and can't decide which one to go for. But the partial transfer restriction of Zopa could end up being a deal breaker.

E.g. Say I have £30k in my Zopa ISA, but wish to transfer out £10k for an emergency purchase. I have to withdraw all £30k, despite only wanting £10k.

I would then need to find a new provider to transfer all of the funds to, thus using up my year's allowance.

Could be even worse if I had say £60k in a Zopa ISA, and needed to withdraw £15k. I now have £60k sat in my bank - how do I get this bank into an ISA?

Or am I missing an easy workaround/method here?

I think you might need to differentiate between withdrawals and transfers ?

If you needed some of the money temporarily and had it in a Smart ISA Access pot, then you could withdraw it and you'd be able to replace it before the end of the tax year without it counting again towards your ISA allowance, because the Access ISA pot is flexible. There are no restrictions on withdrawals from an Access pot, as far as I'm aware.

If you wanted to transfer any of the ISA money away to a new ISA provider, then yes - you'd have to transfer all the different pots you hold within the Smart ISA at once, which means paying a penalty for breaking any Fixed Term pots that you have running.

I currently have a 2 year Fixed Term cash ISA pot with Zopa and won't be opening an Access pot or any further Fixed Term pots, due to the transfer restriction.

Yes, you're correct I was getting mixed up between withdrawals and transfers.

If I have £30k in a Zopa Cash ISA and require £10k for an expense - no issue I can withdraw it at any time, and choose to replace the £10k or not replace the £10k, but as long as this is in the same tax year, replacement would be fine.

However, if I have £30k in a Zopa Cash ISA and their rate drops or I simply wish to transfer to another provider, I can only do this as the full £30k. I can't choose to split £15k between two new providers, for example.
Can I choose to transfer £15k to a different provider and withdraw £15k to my nominated bank account?

refluxer

boco803 said:

From what I've gleaned, ZOPA's Smart ISA is a decent proposition as long as you don't mix & match their variable and fixed ISAs as they don't allow partial transfers (that is, transferring out from easy access variable ISA will also involve the closure and penalty for a fixed ISA).

Yes, that's right.

boco803 said:

I intend to transfer in a couple of maturing ISAs with Santander and Nationwide - has anyone had recent experiences of this with ZOPA? 

I already have their Smart Saver, so applying for the Smart ISA shouldn't be an issue.  Then once the ISA account has been opened, I guess it's just going to the relevant section to request transfers in? 

What type of Smart ISA pot were you wanting to open ? If it's a 1 year Fixed Term pot, then Santander's 1 year fixed rate ISA is actually slightly higher than Zopa's at the moment and the Santander account wouldn't have the transfer-out restrictions that Zopa's has. An internal transfer between Santander ISAs will obviously be slicker than an external transfer and less likely to go wrong, too.  

I funded my Zopa Fixed Term ISA pot with last year's subscriptions so can't comment on their transfer process personally, but there have been threads on this forum earlier this year with a mixture of experiences...

https://forums.moneysavingexpert.com/discussion/6512209/anyone-transferred-a-cash-isa-to-zopa/p1

https://forums.moneysavingexpert.com/discussion/6503767/transfer-in-to-zopa/p1

boco803 said:

I also assume there's an option to transfer once any fixed terms have matured?

When a Fixed Term pot matures, it'll presumably revert to an Access pot. You'll then have the option to keep it as easy access or open another Fixed Term pot. Alternatively, if you wanted to transfer to a different provider at this stage, you would open the new account elsewhere and request the transfer from there.

Something to note for the future if you do open one is that a Zopa Smart ISA has one reference number that covers all pots - individual pots don't have their own sort codes and account numbers. It's this reference that you'd use on the transfer form when transferring away..

refluxer

typeanonspare said:

However, if I have £30k in a Zopa Cash ISA and their rate drops or I simply wish to transfer to another provider, I can only do this as the full £30k. I can't choose to split £15k between two new providers, for example.

If you wanted to transfer from a Zopa Smart ISA to two different ISA providers, you could transfer the full amount (in all pots) to an easy access cash ISA with a different provider 'A' who allows partial withdrawals and then open another ISA account with provider 'B' and arrange a subsequent transfer of half from 'A' to 'B'. 

If any of this money was paid in during the current tax year then, in theory, you're now able to spread new subscriptions over multiple ISA providers but, judging by threads on this subject, not all providers are choosing to adopt the new rules so you may have issues trying to split current subscriptions among multiple providers and things could get complicated.

typeanonspare said:

Can I choose to transfer £15k to a different provider and withdraw £15k to my nominated bank account?

If you wanted to do that with Zopa, you'd need to make the withdrawal first and then arrange the transfer of the remainder. Bear in mind that you wouldn't be able to pay the withdrawn £15k back into a different ISA without it counting towards your current tax year's ISA allowance.

I would imagine that the Smart ISA would be closed as part of the transfer process, in which case there wouldn't be an opportunity to make use of the flexibility of the Smart ISA and pay it back in, if you were wanting to do this to get round the partial transfer-away restriction.

boco803

Thanks @typeanonspare for asking some pertinent questions and thanks to @refluxer for the replies providing clarity.

@refluxer - I'm just considering their Access ISA.  I appreciate the rate will drop after 12 months and even the underlying rate may drop, but considering this over a fixed rate.

VNX

I transferred my NatWest ISA to ZOPA recently took about ten days.

all my ZOPA ISA money is in ZOPA easy access ISA 

Are we only talking about partial withdrawal on fixed term with ZOPA? Does anyone know if I can with draw part of my balance from easy access to my primary pot then out to my current account as I’ll need to do this in a few months 

typeanonspare

VNX said:

I transferred my NatWest ISA to ZOPA recently took about ten days.

all my ZOPA ISA money is in ZOPA easy access ISA 

Are we only talking about partial withdrawal on fixed term with ZOPA? Does anyone know if I can with draw part of my balance from easy access to my primary pot then out to my current account as I’ll need to do this in a few months 

No also talking about partial transfer out of easy access ISA, but with regards to moving part of it to another ISA provider - Zopa doesn't allow this it's all or nothing. Withdrawing part of the amount to your nominated bank account is fine though. Withdrawing any amount = fine. Transferring any amount other than the full amount = not supported.

boco803

Thanks again @refluxer for the links re. transfers into Zopa ISAs.

Mixed experiences, but I wonder if things have improved recently - especially keen to hear from people with Santander and Nationwide who transferred out to Zopa.

Also, if requesting for a full balance (including yet to be paid accrued interest), have people entered a figure?  Is it a mandatory field?

I also picked up on Zopa not acting on non-matured fixed rate accounts - is this true; suggests no option during application to transfer immediately or wait until maturity?

boco803

Sorry - just a few more questions....

Are there any restrictions when transferring in ISAs to Zopa, such as number of transfers in and within a certain time-frame?  I assume able to request multiple transfers in?

I also noticed re. flexibility from their site:

Yes, Zopa’s Access ISA pots are flexible. That means you can withdraw and replace money in the same tax year without affecting your allowance. For example, say you’d saved £10,000 in your Smart ISA. You could withdraw this in full and then add it back in within the same tax year and still have £10,000 of your ISA allowance left.

Just so you know, any money you withdraw and move outside your Smart ISA will no longer qualify as tax-free.

Bit confused on the last statement - should it not mention at the end of the sentence something along the lines of if you do not pay back funds withdrawn within the same tax year?