Transfer Cash ISAs Discussion Area

Baldur

If you have not paid any current tax year's funds (i.e. since 6th April 2008) into the Icesave, or any other, Cash ISA, then you are at liberty to open and fund a Cash ISA with any other provider.

<Edit> If you merely intend to transfer your Nationwide Cash ISA funds with no new money being involved, that does not constitute 'opening' a new ISA and can be done at any time.

ds9074

Sorry if this has already been answered, though the information I have found is confusing. My situation is a bit different from ukclarkkent so I am not sure if the same thing applies.

This all started due to me wanting to take as much advantage of the Natwest 2% bonus as possible. I have a Natwest Cash ISA from a previous year but had paid no money into it since 2007.

Natwest staff got it wrong initally and told me the bonus only applied on the amount transfered in, whereas later they realised its actually on the whole amount.

So initially Natwest advised me to pay as much as possible into any other Cash ISA (other than RBS) and then get that transfered and I could then use the rest of my £3600.

Therefore on that advice I paid in £500 to a Nationwide Cash ISA, which is a subscription for this year.

I then filled in the forms with the staff at Natwest to transfer in full the total amount from Nationwide to Natwest. They indicated that because it was a transfer in full and my Nationwide account would be closed it was THE SAME Cash ISA, just with a different provider. Thus the £3600 overall limit is retained with £3100 remaining.

So Natwest have done the transfer and Nationwide have closed the account I had with them. All the money has gone over and I have paid in a further £200 to the Natwest held ISA.

I am now not sure however whether Natwest have totally got this wrong or whether they are right. The information here on this site indicates they are correct http://forums.moneysavingexpert.com/showpost.html?p=1405182&postcount=16

Transfering Current Years Subscriptions
If you want to transfer savings you have made during the current tax year, they must be transferred in full. If you transfer this years savings but have not subscribed your full allowance, you can top-up your ISA with your new provider. Transfers do not count as subscriptions.

However can someone confirm this.

My online banking with Natwest is saying that I have £3400 left of this years allowance, which fits with the advice above. However I thought I would only have £2900 left at this point (otherwise surely it is unfair as you could use transfers to gain more than the £3600). Or is in fact the advice on this site wrong as well as Natwest and my Natwest ISA is void?

Baldur

Whatever Natwest's online banking says, you have £2,900 of your annual Cash ISA allowance remaining - see chapter 11 of the HMRC ISA Guidance Notes http://www.hmrc.gov.uk/ISA/isa-guidance-notes-2008.pdf

The transfer does not count as a subscription but the £500 which you paid into the Nationwide account prior to transfer does. Any amount paid into the Natwest account over £2,900 would be picked up by the HMRC audit process and voided.

ds9074

Baldur wrote: »

Whatever Natwest's online banking says, you have £2,900 of your annual Cash ISA allowance remaining - see chapter 11 of the HMRC ISA Guidance Notes http://www.hmrc.gov.uk/ISA/isa-guidance-notes-2008.pdf

The transfer does not count as a subscription but the £500 which you paid into the Nationwide account prior to transfer does. Any amount paid into the Natwest account over £2,900 would be picked up by the HMRC audit process and voided.

Many thanks for a fast answer. So Natwest were correct in what they told me, shocking!

My guess is the online banking amount is just a guide to how much of your allowance is left and doesnt take account of transfers.

xiomara_mayoral

Hi & sorry if this has already been answered:

I opened a new cash ISA with Icesave in the beginning of this tax year (and have put there around 500GBP so far) & now as it went bankrupt, I dont know whether I am allowed to open a new one and if so, then what is the correct way of doing it, so that I can keep the rest of my tax-free allowance...???
PS: Of course, I haven't got my money back yet.

Thanks for all your help with this.

Regards

Baldur

xiomara_mayoral wrote: »

I opened a new cash ISA with Icesave in the beginning of this tax year (and have put there around 500GBP so far) & now as it went bankrupt, I dont know whether I am allowed to open a new one and if so, then what is the correct way of doing it, so that I can keep the rest of my tax-free allowance...?

The FSCS should be publishing details tomorrow about the mechanism planned to enable Icesave depositors to access their funds. Presumably this will include Cash ISA funds, which the Government has said will retain their tax-free status.

As the announcement is scheduled for tomorrow, it may be advisable to wait & see what that announcement says.

Transalper

From the FSCS mail Quote:
[FONT=Helvetica,Arial,sans-serif]For ISA holders, the same process will apply as for instant access account holders. An ISA certificate will follow by post to allow you to reinvest that sum in an ISA with another provider. The money you held in your ISA will not lose its tax-free status if you reinvest by 5 April 2009. You should receive your ISA certificate within 2 weeks of claiming compensation using the electronic process and you will have to give this certificate to your new ISA provider when you open your ISA with them. You should ask for an ISA transfer form from your new ISA provider.[/FONT]

[]

Ok anybody know how I can protect my ISA? basically I,m out of the UK in 9 days. Backpacking and voluntary teaching work for nearly 6 months. I have a flight back at the end of April so I will miss the 5 April deadline to reinvest.
If I open an ISA now it would have to be nil balance as I used my allowance.This has to be credited within 30 days (all the banks I've asked anyway) So this is not an option as this "certificate" will most certainly land through my letterbox after the 30 days.
Can I legally get someone else to open an ISA for me or not? If so I would have to get a Power of Atourney in the next week I presume.
What if I opened with £1. I know I used all my allowance. What is the worst that can happen? Would the powers that be, just void the account or take the £1

Transalper

For those going away on holiday/working or leaving the UK there might be some light at the end of the tunnel regarding the ISA transfer.
The fact is you can open a new ISA but the application expires after 30 days if you have not put money in. I tried visiting my bank to try and seek help how I could pre open an ISA with nil balance. If you have used your years tax free allowance then it has to be nil or a transfer. I explained there will suddenly be a lot of money coming their way but the person I spoke to had no answers or in fact any knowledge of the Isesave fiasco. But now after calling the Halifax ISA helpline 0845 600 0169 they inform me that if it is a transfer alapplication (not opening with initial deposits) This 30 days does not apply and aparently can be done with a cash ISA as it is already common practice with stocks and shares type to take time to process. It should be the same with all banks (possibly)
They said to request an interview with my bank's financial advisor which I have arranged for Saturday. I hope this person has swatted up on the latest news:rolleyes:. The Halifax ISA is not the best rate (and I can always transfer at a later date) but that is where my compensation is going so sorting one with them seems to be the simplest way to do it for me as I'm going out of the UK before this is all sorted out fully.

innovate

Transalper wrote: »

The fact is you can open a new ISA but the application expires after 30 days if you have not put money in.

I think this might be different from provider to provider - e.g. RBS seem to be giving longer. From their Q&A:

I have a Cash ISA that I want to transfer but I have to give 60 days notice - will I still get the bonus?
Yes. The 1.75% bonus will be available on your Royal Bank of Scotland Cash ISA as soon as we receive the ISA transfer form and will remain until the twelve month anniversary of the receipt of the transferred ISA funds.

Just give them your form now, enter the Icesave account details, they'll eventually notice they can't get the money - but you can hopefully give it to them in the meantime.

Transalper

I think this might be different from provider to provider - e.g. RBS seem to be giving longer. From their Q&A:

I think it also depends who you talk to in some of these banks. i can only give example with the Halifax at present. I had to get past 2 sales phone operators today that hadn't a clue about any icesave transfers. They could not digest the idea that my ISA would be going into my current account but not loosing tax free status:mad:. It was only when I demanded to speak to a supervisor that I found someone that knew what they were doing. I now have a roll no. and can write a covering letter with my certificate when it appears. And I'm told it will NOT expire after 30 days or less like the phone operators say. I had to cancel my meeting with financial advisor because she rang me and I explained what I wanted and was told that she did not have any knowledge on ISAs and she was just a savings advisor????

I'm afraid the bank staff I have spoken to today at most levels are NOT clued up about the FSCS compensation and the bank certainly not geared up to be able to do transfers that are slightly out of the ordinary.

The banks need to be aware and be told to prepare for a sudden influx of deposits, a lot of them ISAs, maybe someone can send a copy of the email from FSCS to the heads of each bank.