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Cash ISA close withdraw then setup new ISA to get boosted rate
So I have my first Cash ISA with CHIP that I took out last year. I am currently getting 4.48% boosted rate which expires on 31st May this year on the full allowance.
I don't think I can afford to put any new money into a cash ISA next year.
I have opened a trading 212 cash isa with the minimum deposit amount of £1 as it said that to qualify for the boosted rate I had to credit the acount within 8 days IIRC.
Can I close the CHIP Account now and withdraw the funds to my bank account then send that money to the trading 212 cash ISA?
I am a bit of a newbie with ISAs so any advice greatly appreciated.
Comments
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Golden rule with ISAs. Never 'withdraw', always 'transfer'.
If you transfer then it doesn't count as part of your yearly allowance.
1 -
Yes, but the boosted rate is for new money only
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An ISA transfer in to a firm that you haven't held an account at previously, is new money.
I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.1 -
It's not exactly crystal, but these seem to be the Terms for the current Trading 212 Promotional Rate
Says that funds transferred into its cash ISA do attract the bonus rate, but only those deposits from the current financial year.
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Yes but some of these new fintech providers, will not offer their best rates for transfers.
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Unless the funds are from this year's allowance its not new money.
If you current provider doesn’t state that the funds are from this year's allowance you will only receive the standard rate
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It's not a golden rule, and doesn't apply to the OP if their current ISA balance plus further ISA interest credited before 6 April 2027 plus any further ISA subscriptions they might be able to afford before that date do not exceed £20,000.
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I ended up withdrawing the full ISAand interest to my Bank from Chip and closed the account. Then added the remainder to the maximum amount and its showing the promotional interest on my trading 212
0 -
No that's not correct. It's a transferred ISA from a particular tax year to another. It's not new money in the eyes of HMRC.
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