TRANSFER PART OF PREVIOUS YEARS ALLOWANCE AND YOU MAY LOSE THE FLEXIBILITY ON PART NOT TRANSFERRED.

masonic

Then would you consider changing the misleading thread title?

Growingold

masonic said:

That's not a google search, it's an AI hallucination. It should not be trusted any more than a bloke down the pub who remembers reading something on the subject. It isn't how flexible ISAs work in reality.

Consider the following scenario:

• Start with £50k in a flexible cash ISA, £40k from previous years and £10k from current year.
• Then withdraw £20k. This results in £30k from previous years and the ability to make replacement subscriptions of £10k from previous years, followed by £10k from current year.
• Then partially transfer £20k. This results in £10k from previous years and the ability to make replacement subscriptions of £10k from previous years, followed by £10k from current year.
• Add £20k to original flexible cash ISA, add £10k to new cash ISA. This results in £30k in original flexible ISA (including £10k from current tax year), £30k in new ISA (including £10k from current year), allowance fully used and no rules broken.

If the google AI disagrees with that, then you should give it a stern telling off because it is wrong. Preferably in SHOUTY CAPS like this thread's title.

Where you would lose the ability to make the replacement subscriptions is if you transferred the previous year subscriptions in full (you'd lose the first £10k), or transferred the whole ISA in full (you'd lose the full £20k).

I totally agree with your scenario but unfortunately  my original ISA provider doesn't, that is why i googled it.  And AI comes up on a google search.  I posted my original post in case anyone else find themselves in the same situation as  just a word of caution, something to be aware could happen.

Growingold

masonic said:

Then would you consider changing the misleading thread title?

Have edited it.

masonic

Growingold said:

masonic said:

Then would you consider changing the misleading thread title?

Have edited it.

It is still factually incorrect. TRANSFER PART OF PREVIOUS YEARS ALLOWANCE AND YOU MAY WILL NOT LOSE THE FLEXIBILITY ON PART NOT TRANSFERRED. Or, TRANSFER PART ALL OF PREVIOUS YEARS ALLOWANCE AND YOU MAY LOSE THE FLEXIBILITY ON PART NOT TRANSFERRED. Or, TRANSFER PART OF PREVIOUS YEARS ALLOWANCE AND YOU ONE PROVIDER MAY LOSE ATTEMPT TO TAKE AWAY THE FLEXIBILITY ON PART NOT TRANSFERRED.

Now, it would be helpful if you described exactly what happened in your case, including the name of the bank and account you were transferring from, and the sequence of events as I did in my example, as it seem you have a valid complaint against the provider who has wrongly interpreted the rules. Unless there is something in their T&Cs that allows them to cancel flexibility for the ISA in the event of a transfer, they will need to restore your replacement allowance. I don't believe any provider would bury such a penalty clause in their T&Cs, and it is potentially unfair even if they did.

Growingold

masonic said:

Growingold said:

masonic said:

Then would you consider changing the misleading thread title?

Have edited it.

It is still incorrect. TRANSFER PART OF PREVIOUS YEARS ALLOWANCE AND YOU MAY WILL NOT LOSE THE FLEXIBILITY ON PART NOT TRANSFERRED. Or, TRANSFER PART ALL OF PREVIOUS YEARS ALLOWANCE AND YOU MAY LOSE THE FLEXIBILITY ON PART NOT TRANSFERRED.

Now, it would be helpful if you described exactly what happened in your case, including the name of the bank and account you were transferring from, and the sequence of events as I did in my example, as it seem you have a valid complaint against the provider who has wrongly interpreted the rules.

This is the message I've sent my original ISA provider (YBS) They replied but didn't answer my query just talked about current year allowance of £20,000 so have messaged them again.

"I have just transferred part of a previous years ISA from you to XXXXX. Before the transfer I had an ISA allowance of £24,827.46 (£4,827.46 being previous years allowance) .  I transferred £1,500 leaving a balance of what should be £3,327.46 from previous year allowance I can replace before April but this is no longer showing today as being available.

I would be grateful if you could look into this for me."

masonic

Growingold said:

masonic said:

Growingold said:

masonic said:

Then would you consider changing the misleading thread title?

Have edited it.

It is still incorrect. TRANSFER PART OF PREVIOUS YEARS ALLOWANCE AND YOU MAY WILL NOT LOSE THE FLEXIBILITY ON PART NOT TRANSFERRED. Or, TRANSFER PART ALL OF PREVIOUS YEARS ALLOWANCE AND YOU MAY LOSE THE FLEXIBILITY ON PART NOT TRANSFERRED.

Now, it would be helpful if you described exactly what happened in your case, including the name of the bank and account you were transferring from, and the sequence of events as I did in my example, as it seem you have a valid complaint against the provider who has wrongly interpreted the rules.

This is the message I've sent my original ISA provider (YBS) They replied but didn't answer my query just talked about current year allowance of £20,000 so have messaged them again.

"I have just transferred part of a previous years ISA from you to XXXXX. Before the transfer I had an ISA allowance of £24,827.46 (£4,827.46 being previous years allowance) .  I transferred £1,500 leaving a balance of what should be £3,327.46 from previous year allowance I can replace before April but this is no longer showing today as being available.

I would be grateful if you could look into this for me."

Here is what the YBS T&C state about transfers out:

https://www.ybs.co.uk/documents/productdata/General_Terms_and_Conditions.pdf

(Product information for the only flexible cash ISA they offer currently is here and makes no mention of transfers out)

Note that they are saying the transfer will be in line with ISA regulations. There is no clause that allows them to remove flexibility following a partial transfer in their T&Cs.

From your email, the facts seem to be:

• The ISA only contained previous year funds (allowance above £20k)
• You made flexible withdrawals totalling £4,827.46 during this tax year
  
• You transferred out £1,500 as a partial transfer to another provider
  

I'm assuming the total balance of the ISA was more than £1,500 before the transfer, and there is a remaining balance after the transfer. I don't understand where the figure £3,327.46 has come from. The expectation would be that your allowance should still show as £24,827.46 after the transfer. I'm assuming it is actually now showing as £20,000, which is why you are quite rightly querying this?

I think this is likely a mistake, but see what YBS come back with.

Northern_Wanderer

Ok, so I'm all confused by this thread now. I have just spent £xxx of a flexible ISA containing this years and last years balances, I also then transferred a partial amount of last years allowance (ISA remains open) to a diffierent provider, also flexible. I hope to top up some of the funds I spent before April. Now I am worried by this thread.....my terms say:

You can’t replace money into your Easy Access Cash ISA Exclusive if any of the reasons below are true.
– You transfer your ISA to another ISA provider.
– You close your ISA.
– The taxman takes your money to pay your tax bill.
– The taxman or court tells us that we can’t keep your money

I was fairly sure that I was unable to repay funds withdrawn to previous years only if I transferred the full previous years balance before repaying withdrawn funds. Am I correct? Transfer forms have various questions about which tax years you are transferring so I assume that is how they work out all the intricacies.

On a separate note, it's getting confusing to operate ISAs when you have a few different ones open! Need a spreadsheet to keep track!

eskbanker

While transfers do indeed often allow you to nominate whether it's current or prior year money being transferred, the flexible ISA rules entail a pre-determined order of withdrawals and replenishments:

Flexible ISA withdrawals are deemed to be:

• firstly of current year subscriptions
• secondly of previous year funds

Replacement subscriptions are deemed to be:

• firstly of previous year funds
• secondly of current year subscriptions

https://www.gov.uk/guidance/manage-isa-subscriptions-for-your-investors#flexible-isas

The same document addresses transfers but as far as I can see doesn't really clarify the scenarios outlined in this thread....

Northern_Wanderer

eskbanker said:

While transfers do indeed often allow you to nominate whether it's current or prior year money being transferred, the flexible ISA rules entail a pre-determined order of withdrawals and replenishments:

Flexible ISA withdrawals are deemed to be:

• firstly of current year subscriptions
• secondly of previous year funds

Replacement subscriptions are deemed to be:

• firstly of previous year funds
• secondly of current year subscriptions

https://www.gov.uk/guidance/manage-isa-subscriptions-for-your-investors#flexible-isas

The same document addresses transfers but as far as I can see doesn't really clarify the scenarios outlined in this thread....

I guess I will find out soon as I am about to "try" to repay some, although I don't think the transfer out is complete yet...

masonic

Northern_Wanderer said:

Ok, so I'm all confused by this thread now. I have just spent £xxx of a flexible ISA containing this years and last years balances, I also then transferred a partial amount of last years allowance (ISA remains open) to a diffierent provider, also flexible. I hope to top up some of the funds I spent before April. Now I am worried by this thread.....my terms say:

You can’t replace money into your Easy Access Cash ISA Exclusive if any of the reasons below are true.
– You transfer your ISA to another ISA provider.
– You close your ISA.
– The taxman takes your money to pay your tax bill.
– The taxman or court tells us that we can’t keep your money

I was fairly sure that I was unable to repay funds withdrawn to previous years only if I transferred the full previous years balance before repaying withdrawn funds. Am I correct? Transfer forms have various questions about which tax years you are transferring so I assume that is how they work out all the intricacies.

On a separate note, it's getting confusing to operate ISAs when you have a few different ones open! Need a spreadsheet to keep track!

Yes, you are correct.