Full ISA Guide Discussion Area

Tansie

Does anybody know what happens if you transfer an ISA to another provider onto which the interest has been added? Surely this means that you have gone over your allowance if it is transferred with the interest added?

Archi_Bald

Transfers, as long as you follow the ISA transfer procedure, never count towards your allowance. Neither does interest. You must ask the new provider to make the transfer.

The only thing that counts against allowance is any new money you deposit.

Consumerist

Tansie wrote: »

Does anybody know what happens if you transfer an ISA to another provider onto which the interest has been added? Surely this means that you have gone over your allowance if it is transferred with the interest added?

Interest is added by the ISA manager and not by you, so it doesn't count towards the annual allowance.

You could be transferring the ISA between managers for years to come and interest would be added by these various managers along the way. This added interest has no bearing on the ISA allowance in any given year.

torchie

I have a Stocks & Shares ISA taken out in this current tax year. I am now in the position of being able at the 11th hour to use the remainder of my 2014/15 ISA allowance and for ease will put it into a cash ISA. How do I calcuate the amount I can now save because of course the value of the Stocks & Shares ISA has changed - is it the difference between £15K and the amount I originally invested or is it based on the current value of the S&S ISA?

colsten

It is very simple, as only your deposits made in the current FY count towards your current FY allowance.

DrEvazan

Apologies as I'm sure this type of question has been asked somewhere in this thread already.

In short I have about £3500 in an ISA that I've been paying into for the last two years. Interest is about £8 per month. HSBC have said they will pay an additional £10 interest if I open one of their ISA's and save £25 per month. But their interest isn't as good as my current one. So the question is

Can I stop paying into current ISA (and get the £8 interest per month) and open a new HSBC ISA and start paying in £25 per month and get a tiny amount of interest plus the bonus £10?

Thanks

Archi_Bald

DrEvazan wrote: »

Apologies as I'm sure this type of question has been asked somewhere in this thread already.

In short I have about £3500 in an ISA that I've been paying into for the last two years. Interest is about £8 per month. HSBC have said they will pay an additional £10 interest if I open one of their ISA's and save £25 per month. But their interest isn't as good as my current one. So the question is

Can I stop paying into current ISA (and get the £8 interest per month) and open a new HSBC ISA and start paying in £25 per month and get a tiny amount of interest plus the bonus £10?

Thanks

Here's what I would do:

1. provided you have, or qualify for, an HSBC Advance account (pre-req for the HSBC "Save Together" offer) and that you have not put any money into a cash ISA other than the HSBC Loyalty Cash ISA this financial year: open an HSBC cash ISA and put £300 of your £3,500 into it. Not a penny more than £300.
   
   
2. open a TSB Plus account and put £1,500 of your £3,500 into it
   
   
3. open a Nationwide FlexPlus and put the remaining £1,700 of your £3,500 into it
   
   
4. bounce £1,000 a month on the same day, by SO, between your TSB Plus and your FlexDirect once a month
   
   
5. review your situation no later than in 12 months time, when the "Save Together" and the FlexPlus 5% interest ends.

This way your £3,500 will provide you with

• £120 extra 'interest' from the HSBC ISA
  
• £128 after BR tax from the TSB Plus and the FlexDirect - which is a clean £80 more after BR tax than you'd get in a 1.5% ISA.

If you are smart, you can work in at least another £60 a year with a Halifax Reward account that you could operate alongside the above accounts.

If you are burning for using your 2015-15 cash ISA allowance, you can still do so until late March 2016. No hurry needed before then. But unless you have more than £15,240 to save, a cash ISA is probably a big waste of money.

DrEvazan

Wow what an answer! Many thanks!

London2016

Hi, apologies if this has been asked before...I've just opened a Halifax help to buy ISA. I've contributed £100 to an old ISA with nationwide in the last year. Do I have to transfer £100 from my nationwide ISA into the new Halifax ISA with my first Halifax deposit, or the whole amount saved in my nationwide ISA? Thanks!

Consumerist

London2016 wrote: »

Hi, apologies if this has been asked before...I've just opened a Halifax help to buy ISA. I've contributed £100 to an old ISA with nationwide in the last year. Do I have to transfer £100 from my nationwide ISA into the new Halifax ISA with my first Halifax deposit, or the whole amount saved in my nationwide ISA? Thanks!

I think you will need to ask Halifax to transfer the entire Nationwide ISA into the Help to Buy ISA. You are allowed to contribute to only one cash ISA in any tax year but you can transfer it. Since you have opened the Nationwide ISA this year, you must transfer it if you want to add more under a new manager.

If you're up for some bedtime reading, <HMRC Help to BUY ISA Scheme Rules (pdf)> may help. I would refer you to section 4.7 (A) (v)