Monument Blocking ISA Transfer Out – Misallocating Interest and Giving Incorrect Advice?

Wannabericher

Help

Monument Bank are blocking / rejecting my ISA transfer out (from previous years’ funds).

I wanted to see if anyone else has experienced anything similar - and also help anyone who may have been given the wrong advice.

Is this an IT system error, or are customer service being given incorrect guidance?

In mid-April 2025, I transferred in ~£42k of previous years’ ISAs, then added a further £20k subscription for the 2025/26 tax year.

The account has been earning ~3.5% interest, so the balance is now circa £64k.

I’ve been trying to transfer out portions of my previous years’ ISA funds (which should be allowed, in part, at any time):

• One transfer of £21,000
• One transfer of £22,000

However, Monument have rejected the £22,000 transfer multiple times, stating “insufficient funds” - which was baffling given the balance of the account.

After hours on the phone, I finally got more clarity.

They advised that the partial transfer exceeds my previous years’ funds, and said that I can only transfer £21,000 (that being the remainder of the original transfer in).

When I asked about the interest earned on the £42k, they stated that:

"All interest has been attributed to the current tax year, and is NOT allocated to the previous years’ ISA funds"

Why this seems wrong:

My understanding (also confirmed by an independent financial adviser and AI) is:

• ISA interest should retain the tax-year status of the underlying funds
• Previous years’ ISA funds (including interest) can be transferred in part or full
• Only current year subscriptions must be transferred in full

So unless I’m missing something fundamental, this looks like either:

• A system limitation (ie their IT is WRONG), or
• A misapplication of ISA rules

The Manager at Monument

• insist their system is correct
• I’ve been told I “don’t understand how this works” and am not entitled to transfer the funds+interest
• Blame has been passed to systems / third parties (computer says 'no')
• I;ve asked for a manual over-ride or manual-push transfer and been told that that would be blocked by the system

Meanwhile I’m stuck and unable to move funds into a better rate. (I also want to do a full transfer of the balance (my 25/26 subscription) but can only do that once the partial transfer is complete. FYI - I am splitting my balance across a 3yr and 5yr fix which is why I need to do this in parts.

The bigger concern:

If this is how their system is working, then:

• Customers could be given incorrect information about what they can transfer
• And potentially be financially worse off if they don’t challenge it

Questions:

• Has anyone else had issues with Monument and ISA transfers (especially partial transfers)?
• Has anyone seen interest being treated this way across tax years?
• Or am I completely misunderstanding something here?

Thanks in advance — any insight appreciated.

masonic

You say "balance is now circa £84k". You are discussing partial transfers totalling £43k. The annual ISA allowance is £20k. That adds up to £63k. Are they suggesting you have earned £21k in interest since April 2025, which would be a rate in excess of 33% AER? Frankly if you are able to grow an ISA from £62k to £84k within a year, you might be as well to leave it where it is! 😁 Or did you mean £64k?

You are correct that only interest earned on the current tax year account (max £20k) could be withheld from a transfer of prior year funds, so that would equate to a maximum residual balance of about £20,700 at a rate of 3.5%. It seems like you will be leaving behind more than this, so there should be no issue.

I suggest you transfer exactly what they will let you (another £21k), raise a formal complaint and claim any loss of interest from them plus some compensation for the hassle. In just over a week's time you'll be able to transfer any of this money as prior year funds.

FYI:

https://www.gov.uk/guidance/transfer-an-isa-if-youre-an-isa-manager#what-amounts-can-be-transferred

Wannabericher

Typo now corrected - £64k balance.
Thanks for confirming that Monument ARE wrong and that I should be permitted to transfer part or all of a previous years subscription plus interest.

I have raised a formal complaint.

But I wonder how many people have just believed what they have been told or transferred out a lesser amount than they are entitled to, due to the incorrect information provided or IT application and calculations.

ANYONE ELSE HAD THIS PROBLEM?

masonic

Yes, they do have form for being difficult with transfers out, including a very similar issue, see:

forums.moneysavingexpert.com/discussion/6611216/monument-partial-transfer-out-charter-bank-transfer-in

forums.moneysavingexpert.com/discussion/6608119/can-039-t-transfer-isa-from-monument-bank-to-castle-trust-bank

Wannabericher

Your post above confirms that this is a system error - as it, how they are allocating the interest or tracking the values of previous transfers in, and the handling of partial transfer.

This could be something that loads of people are having to work around.

Has anyone else had this experience with a Monument partial transfer out and got a resolution?
Did they offer compensation and redress - or just brush it off and offer a manual/paper solution, and pretend that their system is not at fault?

Wannabericher

Monument have now formally upheld my complaint.

They’ve confirmed there was a technical issue which meant interest on previous years’ ISA funds was not included when assessing partial transfers, which led to valid transfer requests being rejected as “insufficient funds”.

This matches what I had been arguing all along - that interest should form part of the transferable balance - and that Monument Bank were NOT correctly allocating interest to the previous years' funds… They are just counting all interest as interest on the current year's subscription.

In their letter, they state that the ISA Technical Support Team will take action to prevent a recurrence of this issue in the future.

I’ve now initiated another partial transfer which includes a small element of interest - so this should confirm whether the issue has actually been fixed, or whether the same problem still exists in practice.

If anyone else has experienced similar issues with Monument (particularly partial transfers involving interest), would be really useful to compare notes.

Will update again once this latest transfer either completes or gets blocked.