HelptoBuy ISA to LISA Transfer - Does this count towards Annual ISA Allowance?

CuprinolKid

I have put £17k into my Stocks & Shares ISA (so I can add to it during this tax year to get it up to £20k) and at the same time have also tried to transfer £4k from my H2B ISA with Barclays into a Lifetime ISA with the same provider as the S&S ISA. My understanding was that money transferred, that was already in an ISA would not count towards my £20k annual allowance.

The MSE guidance states "If the LISA provider allows transfers from a Help to Buy ISA, fill in its transfer form as you apply. This then won't reduce your overall £20,000 ISA limit."

This is exactly what I have done and the transfer form itself states this 'Remember, transfers from other ISA's to a Lifetime ISA will count against your Lifetime ISA Allowance and receive the government bonus but they will not affect your ISA allowance'

But the investment company involved have said NO to the £4k transfer as it takes me over the £20k in total, stating "The ISA allowance is only impacted by funds being paid in from outside the ISA wrapper. Any other ISAs being transferred in to your Stocks and Shares ISA will not impact the allowance. Transferring from an ISA to the Lifetime ISA is the exception because of the restricted allowance of £4,000.00 and the government bonus which is applied afterwards."

I still don't really understand this explanation, can anyone advise on whether or not their refusal to transfer the £4k is correct or not please ? If not, what do I need to say to get them to complete the transaction as I've challenged this decision twice already ?

I understand that I cannot put more than £4k into my LISA this year from my H2B ISA, I just thought I could still transfer £20k into my S&S ISA in the same tax year.

Thanks very much for any help.

masonic

Your provider is wrong. A transfer from a HTB ISA to your LISA doesn't use any of the annual allowance if done through the formal ISA transfer process. It is just restricted to £4k max per tax year.

Apart from pointing out you are not making any new subscriptions, I've know idea how to explain it to them more simply. Formal complaint would be the next step.

Which provider is it?

(Edit: wonder if it's the same provider as this

https://forums.moneysavingexpert.com/discussion/6660109/is-money-transferred-from-a-help-to-buy-isa-to-lifetime-isa-considered-part-of-the-annual-isa-limit

)

CuprinolKid

Thanks masonic, thought I was going mad !

Its Hargreaves Lansdown.

Thanks for the link to the similar question, nice to see they were actually correct and got it resolved in the end. Gives me hope !

I'll ask to escalate my request for a transfer and then raise a complaint if no progress made.

Thanks again.