Confused about Isa's

spacer_2

I currently have a MAXI ISA with MLC comprising about £4,000 in cash and £9,000 in shares. I have been investing £50 a month to the share component of this MAXI ISA. I also have a Tessa only ISA of approx £8,500.

The MAXI ISA has not performed well and the rate I get on my Tessa only ISA and the cash component of my MAXI ISA is not competitive.

Can anyone advise me of my options before the new Tax year as I am confused. Can I move my Tessa only ISA to a new Cash ISA provider and still keep my MAXI ISA?

Any help would be appreciated

martinman3

The TOISA can be transferred to a Cash ISA at any time as it is not connected with the Maxi ISA at all.
see http://www.moneysavingexpert.com/savings/cash-isa-transfers

Also, the cash part of your Maxi ISA can be transferred to a Cash ISA too if you wish. If you have not contributed to it this tax year 2007/2008 you can transfer it immediately otherwise wait until April 6th and do it then.

The reason for this is that you can only transfer previous tax year contributions from Maxi Cash ISA to Mini Cash ISA, this changes on April 6th. After that date your Maxi ISA will become a Cash ISA and a Stocks & Shares ISA automatically.

spacer_2

Thanks Martinman,

I think I will open a new Cash isa before the end of tax year and transfer in the TOISA and cash component of the MAXI to it, leaving a shares only MAXI ISA open.

I take it that I would then be able to add another £3,000 to the new cash isa before the end of this tax year?

martinman3

Now this is where it gets complicated.

If you contributed to the Share part of your Maxi ISA in this tax year then until the tax year ends all you can do is put £7000- "Share contributions" (up to a maximum of £3000) into the Cash part of the Maxi ISA.

If you didn't contribute to the Share part of the Maxi ISA this tax year you can either (depending on which is easier)
1. put £3000 into the Cash part of the Maxi ISA now and transfer it from April 6th into a new Cash ISA.
or
2. put £3000 into a new Cash ISA of your choice before the tax year ends and transfer the Cash part of the Maxi ISA into it after April 6th.

And from April 6th you can also add another £3600 to your new Cash ISA too.

I am glad these rules are being simplified.;)