a matter of dates - cash ISA advice

khryne

I need some advice please, I currently have 1 active fixed rate cash ISA with Halifax since 2023 that has £16k in it and is due to mature on 20 May.

I have only put in £6k since last May 24 so I still have £14k remaining allowance. I have a further £20k in savings I would like to use.

I want to know if this is possible:
I would like to open a new cash ISA 1yr fixed rate today and put £14k in it and then when my Halifax ISA matures in May I want to transfer the balance (£16k plus interest) into the fixed rate I open today. So I have 1 cash ISA that has £30k+ in it. Plus I would put in a further £6k.

Can I do this like I have explained above or do I need to wait until 6 April or even May 24 to open a new cash ISA for the 25/26 year and do it then?

Bonus advice:
Are there any issues with transferring a fixed rate upon maturity? 
What happens if I do nothing on maturity in May and let halifax change it to a low interest easy access ISA, can I still transfer the 24/25 money to the ISA I open today or a new fixed rate ISA with another bank and keep my money tax free? As long as I don't withdraw it and close the account?

Mark_d

No reason you can't do as you suggest.

One your Halifax ISA matures the money is still in a cash ISA so it can still be transferred.  Don't withdraw the money if you want to protect the tax-free status

refluxer

khryne said:

I want to know if this is possible:
I would like to open a new cash ISA 1yr fixed rate today and put £14k in it and then when my Halifax ISA matures in May I want to transfer the balance (£16k plus interest) into the fixed rate I open today. So I have 1 cash ISA that has £30k+ in it. Plus I would put in a further £6k.

Most fixed rate cash ISAs have a limited window for both new subscriptions and transfers, so you won't be able to do both of those things with the majority of ISA providers.

There are a few exceptions however, that may allow you to do either one or both of the things you want to do.

IIRC....

Barclays allow further new subscriptions to be paid into their 'flexible' (fixed rate) cash ISAs, but have a limited window for new transfers (so you could open one today with your remaining 2024-25 allowance and also pay your 2025-26 allowance into it but won't be able to transfer-in your Halifax ISA in May)

Shawbrook allow further subscriptions to be paid into their fixed rate cash ISAs and, while they state in the T&Cs that 'requests to transfer funds into an account from another ISA provider must be made at the same time as your initial account application' and that 'transfer requests received after your initial account application may be refused', other forumites have managed to transfer-in cash ISAs at a later stage in the past (so you could open one today with your remaining 2024-25 allowance and also pay your 2025-26 allowance into it, plus you might be able to transfer-in your Halifax ISA in May but this isn't guaranteed)

I believe Kent Reliance are also similar, although I don't have personal experience of them so don't know which of those two 'camps' they fall into.

There is just a small caveat to all of this though and that is that not all ISA providers have embraced the new rules about us now being able to open multiple ISAs for current year subscriptions and some are still insisting that you must only hold such an ISA with them alone. This has caused a lot of debate on this forum, as you might imagine ! 

Albermarle

khryne said:

I need some advice please, I currently have 1 active fixed rate cash ISA with Halifax since 2023 that has £16k in it and is due to mature on 20 May.

I have only put in £6k since last May 24 so I still have £14k remaining allowance. I have a further £20k in savings I would like to use.

I want to know if this is possible:
I would like to open a new cash ISA 1yr fixed rate today and put £14k in it No problem with that and then when my Halifax ISA matures in May I want to transfer the balance (£16k plus interest) into the fixed rate I open today. Normally a fixed rate savings account ( ISA or non ISA) will not accept new money/transfers in after the initial funding window ( usually 14 or 30 days) So I have 1 cash ISA that has £30k+ in it. Plus I would put in a further £6k.

Can I do this like I have explained above or do I need to wait until 6 April or even May 24 to open a new cash ISA for the 25/26 year and do it then?

Bonus advice:
Are there any issues with transferring a fixed rate upon maturity? NO
What happens if I do nothing on maturity in May and let halifax change it to a low interest easy access ISA, can I still transfer the 24/25 money to the ISA I open today or a new fixed rate ISA with another bank and keep my money tax free? As long as I don't withdraw it and close the account? Yes

Your plan is not taking into account the rules around fixed rate/fixed  savings accounts. Once they have been opened and funded they are locked after the initial funding period.
There are a few outriders with different rules but they are not the norm.
So you can open a new one with £14K today, but when you want to transfer the one in May it will have to be to another/new account .

khryne

Thinking about it a different way, as there is no limit on how many cash ISAs you can have, only a limit on your annual allowance, does it really matter if I have multiple cash ISAs? What are the pros and cons of having it all in one cash ISA vs multiple cash ISAs? Is it just personal preference?

refluxer

khryne said:

Thinking about it a different way, as there is no limit on how many cash ISAs you can have, only a limit on your annual allowance, does it really matter if I have multiple cash ISAs? What are the pros and cons of having it all in one cash ISA vs multiple cash ISAs? Is it just personal preference?

It's just personal preference at the end of the day, but they may be circumstances where keeping it all together or splitting it may each be advantageous.

You may, for example, want to lock half away in a fixed rate ISA now to guarantee a certain rate but keep half for easy access, in which case splitting it would obviously be the answer.

If you don't need easy access to any of the money and interest rates are falling however, then paying the full allowance into one fixed rate ISA now would guarantee that rate on the full amount.

Just bear in mind the caveat I mentioned above - some ISA providers appear to be insisting that you can only open a cash ISA for new subscriptions with them if you haven't opened one for that purpose with another provider, which actually goes against last year's ISA rule change which now allows this.