Transfer Cash ISAs Discussion Area

Orinoko

colsten wrote: »

You only pay tax on the interest your money earns outside a cash ISA, not on the money itself.

For example:
£10,000 in a 3% AER account pays £240 interest a year after BR tax. BR tax is automatically withheld by the provider. A BR tax payer will not have to pay additional tax on this. Somebody you doesn't have to pay tax can claim the tax back and make £300 a year.

£10,000 in a 1.5% AER ISA pays £150 interest a year.

Aaah ok, I thought when you where told that you should never remove your money from a cash ISA as it will "lose its tax free status" I thought that meant you had to pay tax on that money.

So are there any downsides to moving money out and into one of the better rate new ISA's that dont allow transfers in?

ceejayblue

Don't forget if you have a lot of money in your ISA (I have £60k in mine paying 1.5%) to remove it from the safety wrapper of the ISA and put into a taxable savings account, if you then found an ISA paying more money and wanted to put money into that, you could only put in (presuming its at the beginning of the ISA year) £15K so any more savings would have to stay in the taxable account.

I am a non tax payer (only have my pensions) and besides my ISA I have a Nationwide savings account which I pay no tax on, that pays around 1% interest.I have been using for the last few years to feed into the ISA. In April 2015 I will move the balance into my ISA to make sure it stays tax free because obviously if it was all in a taxable account and the interest rates went up (we can all hope!) then I could end up earning enough interest to take me into the basic rate tax bracket!

boobbby

Orinoko wrote: »

Aaah ok, I thought when you where told that you should never remove your money from a cash ISA as it will "lose its tax free status" I thought that meant you had to pay tax on that money.

So are there any downsides to moving money out and into one of the better rate new ISA's that dont allow transfers in?

The only downside is you can only put into the new ISA £15000 so only take out of a previous ISA the amount you intend to put in your new ISA and leave the rest in the old ISA or transfer the remaining into an ISA that allows transfers.

boobbby

ceejayblue wrote: »

Don't forget if you have a lot of money in your ISA (I have £60k in mine paying 1.5%) to remove it from the safety wrapper of the ISA and put into a taxable savings account, if you then found an ISA paying more money and wanted to put money into that, you could only put in (presuming its at the beginning of the ISA year) £15K so any more savings would have to stay in the taxable account.

I am a non tax payer (only have my pensions) and besides my ISA I have a Nationwide savings account which I pay no tax on, that pays around 1% interest.I have been using for the last few years to feed into the ISA. In April 2015 I will move the balance into my ISA to make sure it stays tax free because obviously if it was all in a taxable account and the interest rates went up (we can all hope!) then I could end up earning enough interest to take me into the basic rate tax bracket!

Nationwide also have a Flexdirect account that gives 5% interest for one year (conditions apply)

quacker1964

Hi

Just a small bit of advice really. I am looking to switch my father's existing cash ISA worth just under £45k for best price. As he hasn't used any of this year's allowance (he is retired) I would like to take advantage of Coventry's current 2.65% but it is for new applications only and not transfers. (4 year fix).

I understand I can transfer to an ISA that accepts transfers in, but for the Coventry one, would he have to withdraw the £15k and start anew? briefly taking out of the "ISA wrapper". I accept this will mean a 2014/15 ISA for £15k and an existing transfer of just under £30k for someone accepting transfers.

As I am tasked with doing this on his behalf, does that sound correct?

TIA

Steve

colsten

Your understanding is correct.

Have you investigated the DotCommunity ISA? It allows transfers in. https://forums.moneysavingexpert.com/discussion/4938603

jimjames

ceejayblue wrote: »

I am a non tax payer (only have my pensions) and besides my ISA I have a Nationwide savings account which I pay no tax on, that pays around 1% interest.I have been using for the last few years to feed into the ISA. In April 2015 I will move the balance into my ISA to make sure it stays tax free because obviously if it was all in a taxable account and the interest rates went up (we can all hope!) then I could end up earning enough interest to take me into the basic rate tax bracket!

If you're a non taxpayer then an ISA is even less relevant.

Rates would have to rise a huge amount to put you into paying tax and you could still put £15k in each year to get it back into an ISA if and when that looked a possibility.

Eco_Miser

jimjames wrote: »

If you're a non taxpayer then an ISA is even less relevant.

Rates would have to rise a huge amount to put you into paying tax and you could still put £15k in each year to get it back into an ISA if and when that looked a possibility.

Well that depends on how close to being a taxpayer ceejayblue is, their income could be £9,999 already.

OTOH, from next April, there's an extra £5k of savings income becomes zero-rated for non-taxpayers and nearly-non-taxpayers.

afmfifgh

Hi,

I was wondering if any one knew of anywhere that keeps a record of the historical best buy rates for the various terms for ISA's that allow transfer's in such as instant access, 1, 2, 3, 4, 5 year fixes?

I want to know if today's rates are any good compared to say what was available 6 months ago or even last week but once a product is pulled I can't find any way of seeing it.

So wondered if there was anywhere that keeps a best buy historical table?

Thanks.

Archi_Bald

Many providers will have the rates for accounts that are no longer marketed on their sites. I am not aware that anyone keeps historic best buys but you could of course ask the best buy sites, or google for historic ISA rates.

May I ask why you want to know the data? Is it a research project for school / college / university? As otherwise there's not much point in confirming what is common knowledge - i.e. interest rates have been steadily dropping for the last few years.