Full ISA Guide Discussion Area

RayWolfe

Payments paid gross. No need for you to do anything ... unless it's dividends and you are a higher rate tax payer.

ColinB

Hi

I'd be grateful for a bit of clarification on the ISA rules please. I have a vague recollection that you are only allowed one ISA per year, so if I already have a Shares ISA, I can't also have a Cash ISA. My situation is that I have a regular savings into a shares ISA in the current year, which will continue into next year. But I also want to put cash into a Cash ISA with a different provider - do the ISA rules allow this ?

Thanks in advance.

Petergmorgan_2

RayWolfe wrote: »

Payments paid gross. No need for you to do anything ... unless it's dividends and you are a higher rate tax payer.

Many thanks for clarifying something that's been niggling me.

Lokolo_2

ColinB wrote: »

Hi

I'd be grateful for a bit of clarification on the ISA rules please. I have a vague recollection that you are only allowed one ISA per year, so if I already have a Shares ISA, I can't also have a Cash ISA. My situation is that I have a regular savings into a shares ISA in the current year, which will continue into next year. But I also want to put cash into a Cash ISA with a different provider - do the ISA rules allow this ?

Thanks in advance.

Yes they allow this :j You can have more than One ISA per tax year, the limit is on Contributions, you can only contribute to ONE Cash ISA per tax year.
S&S ISA is different, you can have this in addition to your cash ISA, this tax year you can invest £3600 in a Cash ISA, AND £3600 in S&S ISA, this changes to £5100 from 6th April. Of course you could invest the entire £7200/£10200 in S&S ISA's if you wanted to :j

Pinkcoke

Hi I went into A&L just before they closed the 09/10 ISA and the man I talked to has made me very confused. I have previous year's ISAs with Barclays including the current year's, what I wanted to know from him was how could I open A&L's ISA for next year's allowance (to get the 3.5% which is now withdrawn incidentally) and he said I couldn't because I had already paid into the current year's ISA. I thought I could open another so long as I didn't pay into it this tax year?

I have also just read that if you close one ISA account in the current year you can't open another the same tax year - how can this be true? I want to transfer out and close all my previous year's ISA due to the bonus rates ending on the 6th but according to the rule above I wouldn't be able to open a new account now to transfer them into?

I have already started a transfer of the worst paying ISA I have (old Barclays Tax Haven 0.9%) to Nationwide's Champion ISA 2.75% (opening it as a new account) however have just discovered that the same banking body own Cheshire BS who have the 12 month fixed 3% ISA and would prefer this of course - I have no idea what stage my transfer is at as they said it could take up to 28 working days, is it too late to stop this? and if it is does that mean it's not possible to close the NW & open the Cheshire one?

Basically what's most confusing me is; is the rule about opening only one ISA account per tax year just for paying in current year's money or old year's too?

Jonahmaul

I'm also looking for a bit of advice as I don't quite understand how ISA's work & about splitting previous years? I have about £7700 in a Natwest ISA from last year which I transferred my previous years in to. Natwest have sent me stuff about applying for a new ISA with them although I've yet to do anything. Now the tax year has ended is this account still classed as an ISA & does it stop me opening another one? If I do open another one could I contribute to both or are you only allowed to contribute to one?

I'm unlikely to fill my ISA allowance this year due to a change in financial circumstances so am looking to get the maximum interest on what I already have but could I transfer my Natwest in to the top paying ISA that allows transfers & then open another ISA to pay new savings in to? Or am I only able to open one?

Thanks in advance for help & clarification on these points as I'm not 100% sure where I stand & want to get myself sorted ASAP to get maximum interest!

Spiggle

Pincoke and Jonahmaul All your old accounts are still ISAs but have now matured and may be transferred out to another provider (that allows transfers in) paying a better interest rate.

Making transfers/opening transfer accounts does not affect the £5100 allowance (for a cash ISA) that you have for the 2010-2011 (current) tax year. For that allowance you may only have one active account (that you are or have paid 'new' money into = subscribing/subscribed to) throughout the year. You may of course transfer this throughout the year as many times as you like (subject to provider penalties and recognising interest will not be earned on the balance during the transfer process).

You could open an account for only your 'old' ISA balances with one provider AND open a new cash ISA with another provider (which may have a higher interest rate) for any 'new' money up to the £5100 allowance for this year. Alternatively, you could put your 'new' money into the one ISA account along with your transfers.

Whatever you decide to do DO NOT WITHDRAW THE MONEY - ONLY EVER TRANSFER THROUGH THE INTERBANK SYSTEM or you will lose the 'tax wrapper' benefit on the money. Once withdrawn from the ISA it becomes 'new' money and you won't be able to invest it tax free other than as part of your £5100 cash ISA limit for 2010-2011.

Pincoke what a shame about the advisor you spoke to in A&L. I did exactly what you describe, opened the account at min 3.5% but didn't subscribe to it as I had already used up my 2009-2010 allowance. I have a current account with them and rang up to check this would be alright and then went ahead without any problems.

I would suggest that the rate A&L has at the moment of 3.2% (guaranteed 2.7% above boe base rate) is still a good deal though only for 'new' money as it doesn't allow transfers in.

Hope that helps,
Spigs

GEOFFERS

please be gentle this is my first time. Can anyone tell me if I invest £5100 in a stocks and shares ISA and £5100 in a cash isa for the current tax year, can I still transfer money from previous years isa's into a stocks and shares isa during this tax year, and if so is there any limit to the amount that can be transfered ? I can't see anywhere where this scenario is mentioned on the site:hello:

vickitoria6232

Baldur wrote: »

You can do either and, if another ISA provider is offering a better rate than your existing one, you can transfer the existing ISA to that provider.

I opened an ISA in February 2010 (fixed at a min of 3.5% for 12months) and put the full allowance in, £3,600. Now it is the new tax year I know I can continue to add to this or I can open a new one, but my question is this...
As the allowance is now £5,100, can I only add in an additional £1,500 to this particular product this tax year or can I put another £5,100 bringing my total in this product £8,700?

Or am I able to add to this current product as it was opened last year, and open a new one elsewhere (as its a new tax year)? Allowing me to save £10,200 in total?
:eek: Confused!

RayWolfe

GEOFFERS wrote: »

Can anyone tell me if I invest £5100 in a stocks and shares ISA and £5100 in a cash isa for the current tax year, can I still transfer money from previous years isa's into a stocks and shares isa during this tax year, and if so is there any limit to the amount that can be transfered ? I can't see anywhere where this scenario is mentioned on the site:hello:

Yes you can. There is no rules on how much of previous years ISAs you can move to another ISA (cash or S&S). There is a limit on moving current years money ... it must be all.