Flexible cash ISA - withdrawing interest

Organgrinder

masonic 

Organgrinder said:

Most certainly not out of date. My wording wasn't good. I meant you can only pay into one per provider. I have multiple cash ISAs opened this year. T212, moneybox etc.

In any event what I stated about having multiple cash ISAs per provider is correct. You can just open them in different tax years.

That isn't correct either. You are allowed to pay into two different ISAs with the same provider in the same tax year (for example two different fixed term ISAs). But T212 only offers one cash ISA, and you can only have one of them overall. Money from different tax years is combined in the same ISA.

Yes my mistake. I stand by my previous comment about multiple cash ISA s with the same provider tho.

masonic

Organgrinder said:

masonic 

Organgrinder said:

Most certainly not out of date. My wording wasn't good. I meant you can only pay into one per provider. I have multiple cash ISAs opened this year. T212, moneybox etc.

In any event what I stated about having multiple cash ISAs per provider is correct. You can just open them in different tax years.

That isn't correct either. You are allowed to pay into two different ISAs with the same provider in the same tax year (for example two different fixed term ISAs). But T212 only offers one cash ISA, and you can only have one of them overall. Money from different tax years is combined in the same ISA.

Yes my mistake. I stand by my previous comment about multiple cash ISA s with the same provider tho.

In general, yes. It is incorrect in reference to T212 though.

Organgrinder

Yes. Sorry. Total misread on my part! I completely missed the t212 reference! Ooops.

Organgrinder

slinger2 said:

Organgrinder said:

Most certainly not out of date. My wording wasn't good. I meant you can only pay into one per provider. I have multiple cash ISAs opened this year. T212, moneybox etc.

In any event what I stated about having multiple cash ISAs per provider is correct. You can just open them in different tax years.

AFAIK that's not 100% true either. Providers can restrict you to one, but that's their choice, not an ISA rule.

You're right. My mistake! 

friolento

Organgrinder said:

slinger2 said:

Organgrinder said:

slinger2 said:

Have you got 2 Cash ISAs with T212? I'm a bit surprised that's allowed.

When you take money out of a savings account the amount in the account goes down. I'm not sure what else you're expecting.

You can take money (capital or interest or whatever) out of a flexible ISA. Flexibility lets you replace that money later in the same tax year without using up any of your £20k allowance.

They are 2 different financial years 2024/25 and 2025/26

There's no such thing as a 2024/25 ISA or a 2025/26 ISA, there's just ISAs. You can have money in an ISA from umpteen different tax years. A cash ISA is just a savings account with a few extra rules.

They can for example be different products eg a fixed rate cash ISA and a variable rate cash ISA. They are not just an ISA. Each year you can only open one cash ISA with a single provider as you know but can have cash ISA with many providers. However two ISAs with different conditions could have been opened in different tax years which is what the poster stated.

You stated you are surprised he had two cash ISAs with the same provider and was surprised it's allowed. Here a response from HMRC. Granted it doesn't say the same provider but you'll find it was perfectly possible to have 2 separate cash ISA s from the same provider.

Many ISA providers limit the number of cash ISAs you can have with them per tax year to one. Some even only allow you one ever. There are also suppliers to allow you more than one with them in the same tax year. Nationwide, for instance, have been doing so for years, even prior to the now more relaxed legislation

Also, your HMRC response has always been wrong because you could always open more than one cash ISA each year., even before current legislation. You just couldn’t subscribe to more than one active ISA in the same tax year in olden times, and you can now 

badger09

Organgrinder said:

slinger2 said:

Organgrinder said:

slinger2 said:

Have you got 2 Cash ISAs with T212? I'm a bit surprised that's allowed.

When you take money out of a savings account the amount in the account goes down. I'm not sure what else you're expecting.

You can take money (capital or interest or whatever) out of a flexible ISA. Flexibility lets you replace that money later in the same tax year without using up any of your £20k allowance.

They are 2 different financial years 2024/25 and 2025/26

There's no such thing as a 2024/25 ISA or a 2025/26 ISA, there's just ISAs. You can have money in an ISA from umpteen different tax years. A cash ISA is just a savings account with a few extra rules.

They can for example be different products eg a fixed rate cash ISA and a variable rate cash ISA. They are not just an ISA. Each year you can only pay into one cash ISA with a single provider as you know. However two ISAs with different conditions could have been opened in different tax years which is what the poster stated.

You stated you are surprised he had two cash ISAs with the same provider and was surprised it's allowed. Here a response from HMRC. Granted it doesn't say the same provider but you'll find it was perfectly possible to have 2 separate cash ISA s from the same provider.

My Bold: your comment is incorrect. Since 6/4/24 it is possible to open, and pay new money into multiple Cash ISAs during the same tax year, subject to the overall ISA subscription limit of £20k

1st line of HMRC response: Comment is, and was at the time it was made, incorrect. There has never been any HMRC rule preventing the opening of more than one Cash ISA. Prior to 6/4/24 you could only pay new money into one at a time. You could however open any number for the purpose of ISA transfers. 

Organgrinder

friolento said:

Organgrinder said:

slinger2 said:

Organgrinder said:

slinger2 said:

Have you got 2 Cash ISAs with T212? I'm a bit surprised that's allowed.

When you take money out of a savings account the amount in the account goes down. I'm not sure what else you're expecting.

You can take money (capital or interest or whatever) out of a flexible ISA. Flexibility lets you replace that money later in the same tax year without using up any of your £20k allowance.

They are 2 different financial years 2024/25 and 2025/26

There's no such thing as a 2024/25 ISA or a 2025/26 ISA, there's just ISAs. You can have money in an ISA from umpteen different tax years. A cash ISA is just a savings account with a few extra rules.

They can for example be different products eg a fixed rate cash ISA and a variable rate cash ISA. They are not just an ISA. Each year you can only open one cash ISA with a single provider as you know but can have cash ISA with many providers. However two ISAs with different conditions could have been opened in different tax years which is what the poster stated.

You stated you are surprised he had two cash ISAs with the same provider and was surprised it's allowed. Here a response from HMRC. Granted it doesn't say the same provider but you'll find it was perfectly possible to have 2 separate cash ISA s from the same provider.

Many ISA providers limit the number of cash ISAs you can have with them per tax year to one. Some even only allow you one ever. There are also suppliers to allow you more than one with them in the same tax year. Nationwide, for instance, have been doing so for years, even prior to the now more relaxed legislation

Also, your HMRC response has been superseded by more recent legislation. In fact, it’s always been wrong because you could always open more than one cash ISA each year. You just couldn’t subscribe to more than one active ISA in olden times 

Yes see above. Made a mistake. 

Organgrinder

badger09 said:

Organgrinder said:

slinger2 said:

Organgrinder said:

slinger2 said:

Have you got 2 Cash ISAs with T212? I'm a bit surprised that's allowed.

When you take money out of a savings account the amount in the account goes down. I'm not sure what else you're expecting.

You can take money (capital or interest or whatever) out of a flexible ISA. Flexibility lets you replace that money later in the same tax year without using up any of your £20k allowance.

They are 2 different financial years 2024/25 and 2025/26

There's no such thing as a 2024/25 ISA or a 2025/26 ISA, there's just ISAs. You can have money in an ISA from umpteen different tax years. A cash ISA is just a savings account with a few extra rules.

They can for example be different products eg a fixed rate cash ISA and a variable rate cash ISA. They are not just an ISA. Each year you can only pay into one cash ISA with a single provider as you know. However two ISAs with different conditions could have been opened in different tax years which is what the poster stated.

You stated you are surprised he had two cash ISAs with the same provider and was surprised it's allowed. Here a response from HMRC. Granted it doesn't say the same provider but you'll find it was perfectly possible to have 2 separate cash ISA s from the same provider.

My Bold: your comment is incorrect. Since 6/4/24 it is possible to open, and pay new money into multiple Cash ISAs during the same tax year, subject to the overall ISA subscription limit of £20k

1st line of HMRC response: Comment is, and was at the time it was made, incorrect. There has never been any HMRC rule preventing the opening of more than one Cash ISA. Prior to 6/4/24 you could only pay new money into one at a time. You could however open any number for the purpose of ISA transfers. 

As per other posts. Agreed. Made a mistake.

Qyburn

masonic said:

Flexible withdrawals can be of current year subscriptions, previous year subscriptions, or income on either. It doesn't matter the source of the money, but withdrawals are first treated as coming from current year subscriptions until depleted and subsequently from previous year subscriptions. Current year subscriptions can be replaced in any valid ISA whereas previous year subscriptions must be returned to the same ISA. It is no more complex than that.

I wasn't aware of that, nor is it mentioned in for example the MSE article which just states without qualification .. "The key rule is you must replace the money in the same ISA account you took it out from, otherwise the deposit will count towards your £20,000 annual limit."

https://www.moneysavingexpert.com/savings/flexible-isas/

What's the best place to see the definitive, current rules?

masonic

Qyburn said:

masonic said:

Flexible withdrawals can be of current year subscriptions, previous year subscriptions, or income on either. It doesn't matter the source of the money, but withdrawals are first treated as coming from current year subscriptions until depleted and subsequently from previous year subscriptions. Current year subscriptions can be replaced in any valid ISA whereas previous year subscriptions must be returned to the same ISA. It is no more complex than that.

I wasn't aware of that, nor is it mentioned in for example the MSE article which just states without qualification .. "The key rule is you must replace the money in the same ISA account you took it out from, otherwise the deposit will count towards your £20,000 annual limit."

https://www.moneysavingexpert.com/savings/flexible-isas/

What's the best place to see the definitive, current rules?

For the current rules, you can just go to https://www.gov.uk/government/collections/isa-managers-guidance

For this former rule, you would need to go back to previous revisions from early April 2024 or earlier, when the rule existed (Wayback capture from 8th April, search "effectively")  - it was changed on 30th April 2024. Or you could check the date of posts you are replying to (though it would be helpful if people didn't resurrect year old threads to ask a question that ought to be in its own thread)