ISA Dilemma

Stonesmike

Hi, I’ve mistakenly opened two isa,s in my name, meant to open one in my wife’s name but mainly due to moving house last week I stupidly opened another one in my name. I am assuming I would just get taxed as a normal account and it would be no advantage if I closed an older isa account?
Any advise would be welcome

subjecttocontract

You can open as many isas as you want to provided you dont deposit more than a total of £20K of new money per tax year in them.

silvercar

https://forums.moneysavingexpert.com/discussion/6684225/isa-dilemma

If you have fully funded one and then opened another, you need to speak to the provider. You can't just pay the tax as if it was an ordinary account as it breaches the terms of the account. Providers often offer a higher interest on ISAs to attract new customers, if it was possible to open an account and then declare that 'actually it shouldn't be an ISA' people would jump on the band wagon just to gain the higher interest rates.

wmb194

https://forums.moneysavingexpert.com/discussion/comment/82145752#Comment_82145752

If both were opened and funded in the current tax year and one’s a flexible ISA then it would simply be a case of withdrawing an amount that gets you back to the maximum £20k contribution limit from the flexible ISA. Flexible ISAs only report the net contributions made at the end of the tax year.

friolento

https://forums.moneysavingexpert.com/discussion/comment/82145752#Comment_82145752

you can open as many ISAs in the sane tax year as you like, regardless of whether you have paid into one, or more, ISAs already in the same tax year. You just must not deposit more than £20k in the same tax year in total across all your ISAs.

Reasons for opening a new tax ISA despite having already deposited £20k in the tax year could include that you want to make an ISA transfer, or shift money from a flexible ISA.

flaneurs_lobster

There is also the small matter of opening an account in someone else's name.

No problem at all just helping with filling out the forms, rather more problematic if you are acting on their behalf without the proper legal framework.

kaMelo

https://forums.moneysavingexpert.com/discussion/comment/82145815#Comment_82145815

What is problematic and what legal framework would I require?

I do all the financial management for my OH and I, they have no interest in doing so. I open accounts, fund them, withdraw from them and close them, including multiple switching offers. I just say 'give me your phone' and do what I need to do, are you suggesting I'm doing something wrong?

Slinky

https://forums.moneysavingexpert.com/discussion/comment/82145887#Comment_82145887

I'm sure you're doing no more than goes on in many households in the UK.

flaneurs_lobster

https://forums.moneysavingexpert.com/discussion/comment/82145887#Comment_82145887

If you are doing exactly as you say then you are (at the very least) in breach of the terms of whichever financial institution you are passing yourself off as your wife to. They only permit the named account holders to access their sites online via their login credentials.

Imagine what would happen if you were to walk into a bank branch and ask to access your wife's account.

In order to act "legally" in this way you would need a Financial Lasting Power of Attorney which would need to be registered with the institution(s) in question.

surreysaver

https://forums.moneysavingexpert.com/discussion/comment/82145898#Comment_82145898

They would not only need a LPA, the person would also be required to be mentally incompetent as well for the LPA to be able to be used.

Disinterest I wouldn't have thought, would be sufficient to use a LPA.

However, I am sure this thought of thing goes on all the time, which leads to scenarios such as this

kaMelo

https://forums.moneysavingexpert.com/discussion/comment/82145898#Comment_82145898

I know what you say is true but, when at home, the banks have no way of telling which one of us is logging in.

As for walking into my OH's bank and asking for access, obviously I couldn't do that, but neither could my OH unless I told them which banks they hold accounts with.