Calculating cash ISA transfer delay and where to pay compensation

masonic

intalex said:

Doesn't the process involve communication of a date by the old provider to the new one, which implies that interest has been paid/accrued up to that date on the transfer amount and the funds have been debited from the customer's account (i.e. no longer earning interest with the old provider as of that date) and made available to "collect" by the new provider who then becomes "responsible" (obliged?) to start accruing interest from that same date?

The best practice guidelines define the seamless handover process for interest payment between the two providers, but they are not prescriptive and either or both providers can choose higher or lower standards. For example, I can think of a provider that pays no interest for the calendar month of a transfer.

rabbituk

Interestingly the TISA guidelines (yes okay only guidelines but still)

"Any compensation paid in respect of a delay in transferring an ISA, in order to put the
investor in the position he would have been in had the ISA been transferred without delay,
may also be paid into the ISA."

Obviously that isn't directive but doesn't preclude it.

masonic

rabbituk said:

Interestingly the TISA guidelines (yes okay only guidelines but still)

"Any compensation paid in respect of a delay in transferring an ISA, in order to put the
investor in the position he would have been in had the ISA been transferred without delay,
may also be paid into the ISA."

Obviously that isn't directive but doesn't preclude it.

Interesting. I have seen cases that contradict that, where the impact of not being able to pay it into the ISA needed to be calculated and added to the sum paid.

intalex

I would like to think that if you "remind" the new provider that the old provider paid interest until XXX date, and that it would be fair (and compliant with TISA guidelines) for them to start paying interest from the same date, there should be a decent probability that they will agree to backdate the interest to XXX (even if the transaction stays recorded some days after XXX).

1spiral

eskbanker said:

rabbituk said:

Looking at the TISA and HMRC guidelines, they say 'up to' 5 business days for each of the stages. So if stage 1 completes immediately and stage 2 starts on the same day, then that doesn't mean stage 2 can be allowed to take up to 5+5=10 business days because stage 1 was completed quickly. The new ISA manager simply says 15 business days and consequently gets a different delayed days figure than I do by using the 'up to 5 days' rule.

Rather than relying on guidance, it's probably best to refer to the actual legislation:

https://www.legislation.gov.uk/uksi/1998/1870/regulation/21A

However, if you continue to struggle to get the receiving provider to accept your assertions, after a formal complaint, then FOS will be your only realistic option, regardless of your misgivings, unless you're prepared to pursue the matter to court - what's the gap between your figure and theirs?

Interestingly, I make the legislation time frame 13 working days not 15 days as I always understood it.

5 days for the new provider to action your request.

5 days for the old provider to send the funds.

3 days for the new provider to credit the funds. (I always thought this was 5 days too)

"(2) Where this regulation applies—

(a)the transferee shall, within 5 business days beginning on the instruction day, send to the transferor—

(i)the transfer instructions; and

(ii)a notice specifying that the transferee consents to the transfer (“the consent notice”);

(b)the transferor shall, within 5 business days beginning on the day that the transferor receives the transfer instructions and the consent notice,—

(i)transfer to the transferee the subscriptions specified in the transfer instructions; and

(ii)send to the transferee a notice containing the information specified in paragraph (3); and

(c)the transferee shall ensure that the subscriptions specified in the transfer instructions are transferred to a cash account [F3held by the account investor] with the transferee within 3 business days beginning on the day that the transferee receives the subscriptions and the notice referred to in sub-paragraph (b)(ii)."

masonic

1spiral said:

eskbanker said:

rabbituk said:

Looking at the TISA and HMRC guidelines, they say 'up to' 5 business days for each of the stages. So if stage 1 completes immediately and stage 2 starts on the same day, then that doesn't mean stage 2 can be allowed to take up to 5+5=10 business days because stage 1 was completed quickly. The new ISA manager simply says 15 business days and consequently gets a different delayed days figure than I do by using the 'up to 5 days' rule.

Rather than relying on guidance, it's probably best to refer to the actual legislation:

https://www.legislation.gov.uk/uksi/1998/1870/regulation/21A

However, if you continue to struggle to get the receiving provider to accept your assertions, after a formal complaint, then FOS will be your only realistic option, regardless of your misgivings, unless you're prepared to pursue the matter to court - what's the gap between your figure and theirs?

Interestingly, I make the legislation time frame 13 working days not 15 days as I always understood it.

5 days for the new provider to action your request.

5 days for the old provider to send the funds.

3 days for the new provider to credit the funds. (I always thought this was 5 days too)

"(2) Where this regulation applies—

(a)the transferee shall, within 5 business days beginning on the instruction day, send to the transferor—

(i)the transfer instructions; and

(ii)a notice specifying that the transferee consents to the transfer (“the consent notice”);

(b)the transferor shall, within 5 business days beginning on the day that the transferor receives the transfer instructions and the consent notice,—

(i)transfer to the transferee the subscriptions specified in the transfer instructions; and

(ii)send to the transferee a notice containing the information specified in paragraph (3); and

(c)the transferee shall ensure that the subscriptions specified in the transfer instructions are transferred to a cash account [F3held by the account investor] with the transferee within 3 business days beginning on the day that the transferee receives the subscriptions and the notice referred to in sub-paragraph (b)(ii)."

The FCA interpretation allows a day for first class post in each direction between the providers.

eskbanker

masonic said:

1spiral said:

eskbanker said:

rabbituk said:

Looking at the TISA and HMRC guidelines, they say 'up to' 5 business days for each of the stages. So if stage 1 completes immediately and stage 2 starts on the same day, then that doesn't mean stage 2 can be allowed to take up to 5+5=10 business days because stage 1 was completed quickly. The new ISA manager simply says 15 business days and consequently gets a different delayed days figure than I do by using the 'up to 5 days' rule.

Rather than relying on guidance, it's probably best to refer to the actual legislation:

https://www.legislation.gov.uk/uksi/1998/1870/regulation/21A

However, if you continue to struggle to get the receiving provider to accept your assertions, after a formal complaint, then FOS will be your only realistic option, regardless of your misgivings, unless you're prepared to pursue the matter to court - what's the gap between your figure and theirs?

Interestingly, I make the legislation time frame 13 working days not 15 days as I always understood it.

5 days for the new provider to action your request.

5 days for the old provider to send the funds.

3 days for the new provider to credit the funds. (I always thought this was 5 days too)

"(2) Where this regulation applies—

(a)the transferee shall, within 5 business days beginning on the instruction day, send to the transferor—

(i)the transfer instructions; and

(ii)a notice specifying that the transferee consents to the transfer (“the consent notice”);

(b)the transferor shall, within 5 business days beginning on the day that the transferor receives the transfer instructions and the consent notice,—

(i)transfer to the transferee the subscriptions specified in the transfer instructions; and

(ii)send to the transferee a notice containing the information specified in paragraph (3); and

(c)the transferee shall ensure that the subscriptions specified in the transfer instructions are transferred to a cash account [F3held by the account investor] with the transferee within 3 business days beginning on the day that the transferee receives the subscriptions and the notice referred to in sub-paragraph (b)(ii)."

The FCA interpretation allows a day for first class post in each direction between the providers.

Yes, this is in the gov.uk documents too:

Cash ISA transfers

Cash ISA to Cash ISA transfers must take place within 15 business days of the transfer instruction being received by the new ISA manager, unless the investor stipulates that the 15 days starts on a later date. The 15 days are broken down as:

1. The new ISA manager has 5 business days to forward the instruction to you.
2. You have 5 business days to send the funds and information to be provided to the new ISA manager.
3. The new ISA manager has 3 business days to apply the funds to the new ISA.
4. The other 2 days are to allow for time taken for first class post between you and the new manager.

https://www.gov.uk/guidance/transfer-an-isa-if-youre-an-isa-manager#cash-isa-transfers

1spiral

masonic said:

1spiral said:

eskbanker said:

rabbituk said:

Looking at the TISA and HMRC guidelines, they say 'up to' 5 business days for each of the stages. So if stage 1 completes immediately and stage 2 starts on the same day, then that doesn't mean stage 2 can be allowed to take up to 5+5=10 business days because stage 1 was completed quickly. The new ISA manager simply says 15 business days and consequently gets a different delayed days figure than I do by using the 'up to 5 days' rule.

Rather than relying on guidance, it's probably best to refer to the actual legislation:

https://www.legislation.gov.uk/uksi/1998/1870/regulation/21A

However, if you continue to struggle to get the receiving provider to accept your assertions, after a formal complaint, then FOS will be your only realistic option, regardless of your misgivings, unless you're prepared to pursue the matter to court - what's the gap between your figure and theirs?

Interestingly, I make the legislation time frame 13 working days not 15 days as I always understood it.

5 days for the new provider to action your request.

5 days for the old provider to send the funds.

3 days for the new provider to credit the funds. (I always thought this was 5 days too)

"(2) Where this regulation applies—

(a)the transferee shall, within 5 business days beginning on the instruction day, send to the transferor—

(i)the transfer instructions; and

(ii)a notice specifying that the transferee consents to the transfer (“the consent notice”);

(b)the transferor shall, within 5 business days beginning on the day that the transferor receives the transfer instructions and the consent notice,—

(i)transfer to the transferee the subscriptions specified in the transfer instructions; and

(ii)send to the transferee a notice containing the information specified in paragraph (3); and

(c)the transferee shall ensure that the subscriptions specified in the transfer instructions are transferred to a cash account [F3held by the account investor] with the transferee within 3 business days beginning on the day that the transferee receives the subscriptions and the notice referred to in sub-paragraph (b)(ii)."

The FCA interpretation allows a day for first class post in each direction between the providers.

So is that expected to be nullified if the transfers are electronic?

masonic

1spiral said:

masonic said:

1spiral said:

eskbanker said:

rabbituk said:

Looking at the TISA and HMRC guidelines, they say 'up to' 5 business days for each of the stages. So if stage 1 completes immediately and stage 2 starts on the same day, then that doesn't mean stage 2 can be allowed to take up to 5+5=10 business days because stage 1 was completed quickly. The new ISA manager simply says 15 business days and consequently gets a different delayed days figure than I do by using the 'up to 5 days' rule.

Rather than relying on guidance, it's probably best to refer to the actual legislation:

https://www.legislation.gov.uk/uksi/1998/1870/regulation/21A

However, if you continue to struggle to get the receiving provider to accept your assertions, after a formal complaint, then FOS will be your only realistic option, regardless of your misgivings, unless you're prepared to pursue the matter to court - what's the gap between your figure and theirs?

Interestingly, I make the legislation time frame 13 working days not 15 days as I always understood it.

5 days for the new provider to action your request.

5 days for the old provider to send the funds.

3 days for the new provider to credit the funds. (I always thought this was 5 days too)

"(2) Where this regulation applies—

(a)the transferee shall, within 5 business days beginning on the instruction day, send to the transferor—

(i)the transfer instructions; and

(ii)a notice specifying that the transferee consents to the transfer (“the consent notice”);

(b)the transferor shall, within 5 business days beginning on the day that the transferor receives the transfer instructions and the consent notice,—

(i)transfer to the transferee the subscriptions specified in the transfer instructions; and

(ii)send to the transferee a notice containing the information specified in paragraph (3); and

(c)the transferee shall ensure that the subscriptions specified in the transfer instructions are transferred to a cash account [F3held by the account investor] with the transferee within 3 business days beginning on the day that the transferee receives the subscriptions and the notice referred to in sub-paragraph (b)(ii)."

The FCA interpretation allows a day for first class post in each direction between the providers.

So is that expected to be nullified if the transfers are electronic?

I've not seen anything suggesting that.

eskbanker

masonic said:

1spiral said:

masonic said:

1spiral said:

eskbanker said:

rabbituk said:

Looking at the TISA and HMRC guidelines, they say 'up to' 5 business days for each of the stages. So if stage 1 completes immediately and stage 2 starts on the same day, then that doesn't mean stage 2 can be allowed to take up to 5+5=10 business days because stage 1 was completed quickly. The new ISA manager simply says 15 business days and consequently gets a different delayed days figure than I do by using the 'up to 5 days' rule.

Rather than relying on guidance, it's probably best to refer to the actual legislation:

https://www.legislation.gov.uk/uksi/1998/1870/regulation/21A

However, if you continue to struggle to get the receiving provider to accept your assertions, after a formal complaint, then FOS will be your only realistic option, regardless of your misgivings, unless you're prepared to pursue the matter to court - what's the gap between your figure and theirs?

Interestingly, I make the legislation time frame 13 working days not 15 days as I always understood it.

5 days for the new provider to action your request.

5 days for the old provider to send the funds.

3 days for the new provider to credit the funds. (I always thought this was 5 days too)

"(2) Where this regulation applies—

(a)the transferee shall, within 5 business days beginning on the instruction day, send to the transferor—

(i)the transfer instructions; and

(ii)a notice specifying that the transferee consents to the transfer (“the consent notice”);

(b)the transferor shall, within 5 business days beginning on the day that the transferor receives the transfer instructions and the consent notice,—

(i)transfer to the transferee the subscriptions specified in the transfer instructions; and

(ii)send to the transferee a notice containing the information specified in paragraph (3); and

(c)the transferee shall ensure that the subscriptions specified in the transfer instructions are transferred to a cash account [F3held by the account investor] with the transferee within 3 business days beginning on the day that the transferee receives the subscriptions and the notice referred to in sub-paragraph (b)(ii)."

The FCA interpretation allows a day for first class post in each direction between the providers.

So is that expected to be nullified if the transfers are electronic?

I've not seen anything suggesting that.

Agreed - the legislation itself is silent on the time for postage but did envisage electronic communication as well, so if there was a reason to differentiate timescales then it would have been spelt out there:

(4) For the purposes of paragraph (2)(a) and (b), the transfer instructions and the notices (as appropriate) shall be treated as sent if they are—

(a) posted to, or left at, the proper address of the transferor or the transferee (as appropriate); or

(b) transmitted by electronic communication.