Full ISA Guide Discussion Area

igaquo1

ok thanks. How do they actually check this? (that you haven't opened two in a year, even if your contributions are within the limits?)

Baldur

igaquo1 wrote: »

ok thanks. How do they actually check this? (that you haven't opened two in a year, even if your contributions are within the limits?)

ISA providers are obliged to inform HMRC and all of your ISAs are identified against your National Insurance Number - even if not picked up immediately, it would almost certainly be picked up on audit.

john909

I have opened a cash ISA with one lender but have have not put any money into it yet. Is it possible for me to open another cash ISA and close down the one with no money put into it yet?

Thanks

rb10

john909 wrote: »

I have opened a cash ISA with one lender but have have not put any money into it yet. Is it possible for me to open another cash ISA and close down the one with no money put into it yet?

Thanks

Yes, it is. An ISA does not 'count' unless you have actually paid some money in.

SallyG

If you have a cash ISA opened in March with no money in it because you spotted and opened a better cash ISA in the following April can you still put cash into the March/empty ISA to get the tax exemption and then move it for a better % interest rate or into a shares ISA?

blueberrypie

SallyG wrote: »

If you have a cash ISA opened in March with no money in it because you spotted and opened a better cash ISA in the following April can you still put cash into the March/empty ISA to get the tax exemption and then move it for a better % interest rate or into a shares ISA?

If you put money into an ISA after April 5th, you have subscribed to that ISA, and it becomes your ISA for the current year. You cannot put new funds into any other ISA during the same tax year, regardless of when you opened the account.

The first ISA - opened in March - is essentially non-existent, as far as the tax people are concerned, and in not funding it prior to the end of the 09/10 tax year, you lose your 09/10 allowance.

rb10

SallyG wrote: »

If you have a cash ISA opened in March with no money in it because you spotted and opened a better cash ISA in the following April can you still put cash into the March/empty ISA to get the tax exemption and then move it for a better % interest rate or into a shares ISA?

Your 'current year' subscriptions must always stay together, all the time.

This means that, if you have not used up your entire allowance for 2010/11, you can:

1) Top up your April ISA; or
2) Transfer your April ISA to your March ISA, and then top up the March ISA.

Whichever of these two you choose, all money that you have paid into an ISA between 06/04/10 and 05/04/11 will always be together. You can transfer it around between accounts whenever you like, as long as it always stays together. That is to say, you cannot do a partial transfer of current year funds.

After the end of this tax year, any money that you have paid in this year will be 'previous year' funds. So from 06/04/11, you will be able to do what you like with it - i.e. transfer either all of it or just some of it to another ISA.

(Note - bear in mind that some providers will automatically close accounts or reduce the interest rate if you open them but don't pay anything in, so double check that that March ISA is still open, and still has the interest rate that you think it has before going further.)

captain_mainwaring

Hi all. I find ISA's quite confusing. I have a ISA that I paid into last year (2010). I am thinking of changing the bank it's with by transferring into another ISA now, please tell me what date can I start or transfer a new ISA? I obviously don't want to lose anything by doing it too early and I obviously don't want too lose anything by doing it too late. Hope this is clear and someone can point me in the correct direction. Thanks in advance.

blueberrypie

captain_mainwaring wrote: »

Hi all. I find ISA's quite confusing. I have a ISA that I paid into last year (2010). I am thinking of changing the bank it's with by transferring into another ISA now, please tell me what date can I start or transfer a new ISA? I obviously don't want to lose anything by doing it too early and I obviously don't want too lose anything by doing it too late. Hope this is clear and someone can point me in the correct direction. Thanks in advance.

You can transfer funds from one ISA to another anytime you want. Sometimes with a fixed-rate ISA there is a set period for it to run, in which case you could lose interest or incur a penalty by transferring the money out early, but otherwise, you can do it whenever.

You must keep all of the current tax year's ISA contributions together - that is, you can't transfer a part of them to a different ISA and leave the rest in the first one. Previous tax year's contributions can be split however you want.

The current tax year is 2010/2011 - each tax year runs from April 6th to April 5th. If you put funds into an ISA before April 6th, 2010, they will be considered your 2009/10 allowance, and you are therefore eligible to open a new ISA, with new funds (or to top up the old ISA with new funds) now. If you put the money in on or after April 6th 2010, you will have to wait until the 2011/12 tax year (i.e. April 6th, 2011) to start a new ISA.

captain_mainwaring

blueberrypie wrote: »

You can transfer funds from one ISA to another anytime you want. Sometimes with a fixed-rate ISA there is a set period for it to run, in which case you could lose interest or incur a penalty by transferring the money out early, but otherwise, you can do it whenever.

You must keep all of the current tax year's ISA contributions together - that is, you can't transfer a part of them to a different ISA and leave the rest in the first one. Previous tax year's contributions can be split however you want.

The current tax year is 2010/2011 - each tax year runs from April 6th to April 5th. If you put funds into an ISA before April 6th, 2010, they will be considered your 2009/10 allowance, and you are therefore eligible to open a new ISA, with new funds (or to top up the old ISA with new funds) now. If you put the money in on or after April 6th 2010, you will have to wait until the 2011/12 tax year (i.e. April 6th, 2011) to start a new ISA.

Thanks very much for your help. Now as all I have to do is find some funds for April 6th. Cheers again