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    • dont_use_vistaprint
    • By dont_use_vistaprint 8th Sep 19, 10:06 AM
    • 439Posts
    • 131Thanks
    dont_use_vistaprint
    HTB ISA - Parents Questions
    • #1
    • 8th Sep 19, 10:06 AM
    HTB ISA - Parents Questions 8th Sep 19 at 10:06 AM
    Hi

    Can I transfer money direct into kids HTB ISA accounts, or must I transfer to them and they pay in ?

    If I can, is the limit £200 per month ? What happens if more is paid in or if I put £200 a month in and they also put a smaller amount in ?

    Is this currently the best way for kids between 18-24 to save for a deposit , if saving around 200 a month over approx 3-5 years. Are there other options to look into?

    I have an initial lump sum to give - I said i would match their savings over the summer - so putting this in a HTB ISA monthly works well for me I can keep it earning interest, but the agreement was payment of lump sums in Sept. Are there any tax implications for me with either ?

    Thanks
    Last edited by dont_use_vistaprint; 08-09-2019 at 10:09 AM.
    "It is not the critic who counts..." - Theodore Roosevelt
Page 1
    • eskbanker
    • By eskbanker 8th Sep 19, 10:46 AM
    • 11,380 Posts
    • 14,117 Thanks
    eskbanker
    • #2
    • 8th Sep 19, 10:46 AM
    • #2
    • 8th Sep 19, 10:46 AM
    Can I transfer money direct into kids HTB ISA accounts, or must I transfer to them and they pay in ? You can do it directly, although it's probably better to transfer to them first (as below).

    If I can, is the limit £200 per month ? Yes, after the first month (when a one-off opening contribution of up to £1,000 can be made).

    What happens if more is paid in or if I put £200 a month in and they also put a smaller amount in ? The ISA provider should reject any transaction that would breach the limit but obviously such breaches are more likely if payments are being made by multiple people.

    Is this currently the best way for kids between 18-24 to save for a deposit , if saving around 200 a month over approx 3-5 years. Are there other options to look into? Lifetime ISAs are worth considering, a comparison between the two is included at https://www.moneysavingexpert.com/savings/lifetime-isas/

    I have an initial lump sum to give - I said i would match their savings over the summer - so putting this in a HTB ISA monthly works well for me I can keep it earning interest, but the agreement was payment of lump sums in Sept. Are there any tax implications for me with either ? There could be tax implications involved in gifting money (e.g. https://www.gov.uk/inheritance-tax/gifts) but no significant difference between those two approaches.
    Originally posted by dont_use_vistaprint
    See answers inline above....
    • dont_use_vistaprint
    • By dont_use_vistaprint 8th Sep 19, 10:57 AM
    • 439 Posts
    • 131 Thanks
    dont_use_vistaprint
    • #3
    • 8th Sep 19, 10:57 AM
    • #3
    • 8th Sep 19, 10:57 AM
    See answers inline above....
    Originally posted by eskbanker
    Awesome, thanks.
    "It is not the critic who counts..." - Theodore Roosevelt
    • Alexland
    • By Alexland 8th Sep 19, 8:20 PM
    • 5,765 Posts
    • 5,032 Thanks
    Alexland
    • #4
    • 8th Sep 19, 8:20 PM
    • #4
    • 8th Sep 19, 8:20 PM
    Can I transfer money direct into kids HTB ISA accounts, or must I transfer to them and they pay in ? You can do it directly, although it's probably better to transfer to them first (as below).
    Originally posted by eskbanker
    Are you sure? This isn't a Junior ISA so the individual should make the ISA subscription?

    Alex
    • eskbanker
    • By eskbanker 8th Sep 19, 11:46 PM
    • 11,380 Posts
    • 14,117 Thanks
    eskbanker
    • #5
    • 8th Sep 19, 11:46 PM
    • #5
    • 8th Sep 19, 11:46 PM
    Are you sure? This isn't a Junior ISA so the individual should make the ISA subscription?

    Alex
    Originally posted by Alexland
    I can't say I'm 100% positive but some discussion on here many years ago seemed to conclude that it was OK for cash ISAs but not S&S:

    https://forums.moneysavingexpert.com/showthread.php?t=3241596

    The wording quoted back in 2011 survives into the current HMRC guidance:
    Investors can subscribe cash to each type of ISA. They must subscribe with their own cash, and this includes payment by cheque, direct debit, charge card, credit card, telegraphic transfer and standing order. Cash subscriptions from third parties can be accepted without question unless the ISA manager holds information that shows that the cash does not belong to the investor.

    [...]

    Cash subscriptions from the investor’s employer may be accepted where the employer confirms that the payment will be treated as a relevant payment to an employee for the purposes of the pay as you earn (PAYE) regulations and a payment of earnings for the purposes of Class 1 National insurance contributions (NIC).
    and the existence of the bolded text, even with its potentially self-contradictory caveats, suggests to me that there's no fundamental reason why such third party payments shouldn't be allowed, but there is scope for differing interpretation....

    Of course, individual ISA providers may choose to layer on their own Ts & Cs in addition to the scheme rules themselves!

    Turning it round the other way, is there anything (other than alternative interpretation of the above) that suggests such third party payments wouldn't be allowed?
    • Alexland
    • By Alexland 9th Sep 19, 7:23 AM
    • 5,765 Posts
    • 5,032 Thanks
    Alexland
    • #6
    • 9th Sep 19, 7:23 AM
    • #6
    • 9th Sep 19, 7:23 AM
    Of course, individual ISA providers may choose to layer on their own Ts & Cs in addition to the scheme rules themselves!
    Originally posted by eskbanker
    In my experieince ISA managers seem to navigate this uncertanity by requiring the subscriptions do come from the individual. It's worth the OP's children checking with their HTB ISA provider.

    Alex
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