From existing 120 day notice ISA to H2B
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kaleel86
Posts: 27 Forumite
Hi,
Looking to open a H2B ISA but I currently have a 120 day notice ISA.
With the deadline being November and the notice period for my existing ISA being 120 days, does this mean that I won't have enough time to close that ISA and open the H2B ISA? or am I okay to open the H2B ISA even whilst my existing one is still 'live'?
I'm just a little confused about what i'm allowed to do in terms of having more than 1 ISA account and don't want to run into any trouble later on down the line.
thanks in advance for your help
Looking to open a H2B ISA but I currently have a 120 day notice ISA.
With the deadline being November and the notice period for my existing ISA being 120 days, does this mean that I won't have enough time to close that ISA and open the H2B ISA? or am I okay to open the H2B ISA even whilst my existing one is still 'live'?
I'm just a little confused about what i'm allowed to do in terms of having more than 1 ISA account and don't want to run into any trouble later on down the line.
thanks in advance for your help
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Comments
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If you haven't actually contributed to the 120-day notice ISA during 2019/20 tax year, you can go ahead and contribute to the HTB from your current years subscription allowance without issue.
However, 2019/20 contributions must stick together with the same provider and if your notice ISA is not with a provider who would let you split the current year allowance between the notice account and their HTB product, you will have to do a transfer.
If you open the HTB by transfer in from the notice account, using the new HTB provider's transfer process, they will just go and get the money from your old account. You don't need to actually serve 120 days notice, you simply suffer an interest penalty if you don't give the notice.
As all current year contributions must stay together with the same provider, if amount in the notice account is more than could be accepted into the HTB in the first month of it being opened (£1200 limit) you would need to first withdraw the rest of the current year contributions from that notice account so that the remainder fitted within the £1200 limit. Again, that would cost you a penalty of interest as you don't have 120 days left in which to do it.0 -
bowlhead99 wrote: »If you haven't actually contributed to the 120-day notice ISA during 2019/20 tax year, you can go ahead and contribute to the HTB from your current years subscription allowance without issue.
However, 2019/20 contributions must stick together with the same provider and if your notice ISA is not with a provider who would let you split the current year allowance between the notice account and their HTB product, you will have to do a transfer.
If you open the HTB by transfer in from the notice account, using the new HTB provider's transfer process, they will just go and get the money from your old account. You don't need to actually serve 120 days notice, you simply suffer an interest penalty if you don't give the notice.
As all current year contributions must stay together with the same provider, if amount in the notice account is more than could be accepted into the HTB in the first month of it being opened (£1200 limit) you would need to first withdraw the rest of the current year contributions from that notice account so that the remainder fitted within the £1200 limit. Again, that would cost you a penalty of interest as you don't have 120 days left in which to do it.
you have current year contributions in
Thanks for your reply.
Unfortunately I have made contributions this year though not much and the amount in the account is definitely over the £1200 limit.
So just so I'm clear(er) on this... the 120 day notice period just means that i will lose some/all of my interest for this financial year by withdrawing from the account sooner than 120 days but it's still allowed?0 -
So just so I'm clear(er) on this... the 120 day notice period just means that i will lose some/all of my interest for this financial year by withdrawing from the account sooner than 120 days but it's still allowed?
Correct, the ISA regulations mean that if you want to move to a different provider you can, straight away, and the existing ISA account manager can't stop you - he can however penalise you if you promised to give 120 day notice and are now just taking your money and running.
As you have contributions in the current year than you could transfer into the HTB, you unfortunately can't just transfer the whole lot in.
You could however transfer the whole lot to a provider that allows 'split' cash ISAs (e.g. Aldermore, Nationwide, Halifax, various others) and then open a HTB with them. Plenty of time to do that before end of November.0
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