Switching ISA, putting in money now and next year!!

Trumsiz123

Hi,
I'm sorry that this has been probably asked in many threads before, and I've looked but seemed to get more confused the more I read.

Can I do the following (time permitting!!):

Switch £2200 ISA from NAtwest to ICEsave now.
Put £3000 in ICEsave now.

Put another £3600in ICEsave after April (new tax year)?

Am I correct to think that the switching of the ISA from one bank to another doesn't really have any bearing on the £3000 limit each tax year. So if I don't switch it before April it's doesn't matter?

thanks
Sue

Mikeyorks

No .... you can't do what you propose - as time doesn't permit. You won't get the transfer done in time to add the £3k.

What you can do is add the £3k to Natwest immediately .. then do the transfer. Then add the £3.6k once the transfer is complete.

In all of that I'm assuming that none of the £2.2k in Natwest has been contributed since 5th Apr 07? If it has, then you need to minus whatever you've contributed this financial year from the £3k above.

Am I correct to think that the switching of the ISA from one bank to another doesn't really have any bearing on the £3000 limit each tax year. So if I don't switch it before April it's doesn't matter?

I think I was OK with the first sentence .. until you added the second sentence!;) On the first sentence ..... a transfer does not impact the annual allowance. Once the ISA is transferred it's regarded as though the ISA had always been with the new provider. So if you'd paid in £1k with the old provider - you can cheerfully add the balance of the allowance when it's with the new provider. But really struggling with the 2nd sentence. You keep your £3k entitlement for 07-08 whether you stay with Natwest or move elsewhere. The only impact is if you've already part contributed during this year .... in which case you only have the balance of the £3k left. But that applies irrespective of whether you're adding the money prior to transfer or afterwards.

But - at the 28th March - you can't add the money after transfer .. as you've left it too late. So you have to add it now ... if you wish to use the (balance of?) the 07-08 allowance.

Trumsiz123

Thanks, I think I understand. No I don't think I'll get the transfer done in time but it's useful to know anyway!

thanks
Sue