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    • lisyloo
    • By lisyloo 19th May 11, 4:30 PM
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    lisyloo
    • #2
    • 19th May 11, 4:30 PM
    • #2
    • 19th May 11, 4:30 PM
    Yes.

    Are they gifting you the money?
    In which case there could be inheritance tax due if they die within 7 years and it's not exempt from IHT.
    So basically normal gifting rules apply.
    • dunstonh
    • By dunstonh 19th May 11, 4:59 PM
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    dunstonh
    • #3
    • 19th May 11, 4:59 PM
    • #3
    • 19th May 11, 4:59 PM
    They cant pay directly into your ISA but they can pay you as a gift and you can then pay it in.
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • junai139
    • #4
    • 19th May 11, 5:00 PM
    • #4
    • 19th May 11, 5:00 PM
    Yes it would be a gift transferred from a personal bank account on a monthly basis . Would the bank scrutinise this and think it was money laundering?
    • Lokolo
    • By Lokolo 19th May 11, 5:02 PM
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    Lokolo
    • #5
    • 19th May 11, 5:02 PM
    • #5
    • 19th May 11, 5:02 PM
    If the amounts are varying in large and small deposits, at different times of the month, then yes.

    But a static amount at the same time of the month, then no.
    • lisyloo
    • By lisyloo 19th May 11, 5:12 PM
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    lisyloo
    • #6
    • 19th May 11, 5:12 PM
    • #6
    • 19th May 11, 5:12 PM
    They cant pay directly into your ISA
    I paid into someone else's ISA using BACS with their sort code and account number.
    It was my husbands but I don't think that made any difference.
    You can pay money into any account you like with BACS, providing you have the account details.
    Not sure why you can't when I've done it???
    • JimmyTheWig
    • By JimmyTheWig 19th May 11, 5:24 PM
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    JimmyTheWig
    • #7
    • 19th May 11, 5:24 PM
    • #7
    • 19th May 11, 5:24 PM
    They cant pay directly into your ISA but they can pay you as a gift and you can then pay it in.
    Originally posted by dunstonh
    If this wasn't you saying this, dunstonh, I wouldn't believe it. I've never heard this.
    • AirlieBird
    • By AirlieBird 19th May 11, 5:50 PM
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    AirlieBird
    • #8
    • 19th May 11, 5:50 PM
    • #8
    • 19th May 11, 5:50 PM
    When you sign your ISA application form you are declaring that "All subscriptions made, and to be made, belong to me"
    • dunstonh
    • By dunstonh 19th May 11, 6:30 PM
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    dunstonh
    • #9
    • 19th May 11, 6:30 PM
    • #9
    • 19th May 11, 6:30 PM
    If this wasn't you saying this, dunstonh, I wouldn't believe it. I've never heard this.
    Originally posted by JimmyTheWig
    Looking at the HMRC ISA rules it says (under section 6.6):

    Investors can subscribe cash to either 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.


    The problem is that this is that its contradictory. First bit says own money including cheque, debit card etc. However, second bit says cash from third parties is allowed unless the ISA manager knows it does the cash does not belong to them.

    How this tends to get interpreted by ISA managers is that cheques, direct debits and debit cards have to be drawn on an account belonging to the same person.

    I would say that cheques from third parties should be rejected as the ISA manager can clearly see that they are drawn on a third party. However, the lack of checking on low value cheques and the lower knowledge of rules by bank clerks nowadays probably allows many to go through. Physical cash is probably the only item that can go into cash ISAs without question (subject to money laundering regs).

    The OP was looking at monthly payment which would suggest direct debit or standing order. In which case the money should come from their own account (although if using BACs, there probably isnt anyone checking).
    Last edited by dunstonh; 19-05-2011 at 6:32 PM.
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
    • ses6jwg
    • By ses6jwg 19th May 11, 7:20 PM
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    ses6jwg
    Just so you dont fall foul of the rules, I would reccomend they make a payment to your bank account, then you set up a SO for an identical amount to go out 3 days later
  • archived user
    That's not contradictory. It becomes "your money" at the moment the 3rd party indicates that he is gifting it to you, or by depositing a payment into your account.

    Your salary becomes yours when your employer pays it into your account. Nobody quibbles about its source.
    • lisyloo
    • By lisyloo 20th May 11, 9:07 AM
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    lisyloo
    I agree with Cliff.
    It someone gives you a gift it's yours.
    However if you are worried about the letter of the law then make sure it goes from your account.
    • JimmyTheWig
    • By JimmyTheWig 20th May 11, 9:22 AM
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    JimmyTheWig
    As with lisyloo, I agree with Cliff.
    No-one (with the arguable exception of a spouse) is allowed to use your ISA allowance for themselves (e.g. if they have already used up all of their own allowance and have more cash to save).

    Any way of depositing cash (cheque, direct debit, etc) is allowed, but it has to be the account holder's own money. So if someone owes you 1000, they can pay it directly into your ISA and it becomes your money. Equally if someone wants to give you some money they can do so.
    But what would cause suspicions is if, say, someone made a direct transfer into your ISA of 1000 and then 6 months later you made a transfer of 1020 from your ISA to that same person. That would make it look like the investor was using your ISA for themselves and the ISA manager may get suspicious.
  • HisDoris
    I pay 70 a week into my OH's ISA - its with Halifax. I have paid money into his ISA on various occasions in the past few years with no problems at all.

    I didnt actually realise that you wern't 'supposed' to! We've always paid money into each others ISA's and its never caused us any problems
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    • lisyloo
    • By lisyloo 20th May 11, 9:38 AM
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    lisyloo
    Are you married?
    If you are married then you can gift whatever you like to each other whenever you like free of tax so there are really no tax issues.

    Otherwise you are allowed to "gift" money to each other subject to IHT laws, however it would have to be a genuine gift with no strings attached and not just someone "looking after" the money for you to evade tax as that is called tax evasion and is illegal.
    Even genuine gifts could potentially be suject to inheritance tax if one of you died.
    • dunstonh
    • By dunstonh 20th May 11, 9:45 AM
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    dunstonh
    My anecdotal view is that S&S ISA managers follow this pretty religiously. Whereas cash ISAs do not. S&S ISA managers will return applications with a cheque drawn on an account not belonging to the person applying for the ISA or where the monthly D/D is not on an account of the person owning the ISA.

    The bit that I believe is contradictory is:
    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.

    That is saying that physical cash from third parties is ok unless the ISA manager has evidence to the contrary. Yet payments from direct debits, standing orders etc have to be from the ISA holder. However, it says "They must subscribe with their own cash, and this includes...". If it said they must subscribe with their own money, then that would be clear but to use "cash" usually infers physical money (i.e. notes and coins). Just as it does in the second part of that rule.

    I pay 70 a week into my OH's ISA - its with Halifax. I have paid money into his ISA on various occasions in the past few years with no problems at all.
    You would have had problems if it was an S&S ISA though.
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • Saints2011
    I was under the understanding that "Do you declare that all subscriptions made and to made to the ISA belong to you"
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    • JimmyTheWig
    • By JimmyTheWig 20th May 11, 11:15 AM
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    JimmyTheWig
    That's interesting, dunstonh.
    I agree that what you are describing is as if they mean money in the first instance and notes and coins in the second instance.
    I assumed that they meant the same in each case. Given they clearly state that they mean money in the first instance I figured they meant money in the second instance, too.

    All very odd. I mean, other than the fact that it would be impossible to trace, why allow someone to pay in cash but not cheque?

    Presumably the same rules don't apply whenever you buy stocks and shares (i.e. outside of an ISA wrapper)?


    OP, acedemic interest aside, I suggest you either ask your specific bank or you get your kind and generous friend to pay the money into your current account and you move it to your ISA from there (as per ses6jwg).
    • dunstonh
    • By dunstonh 20th May 11, 11:25 AM
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    dunstonh
    Presumably the same rules don't apply whenever you buy stocks and shares (i.e. outside of an ISA wrapper)?
    All the providers I have used always ask for a cheque drawn on the account of the investor. That is for money laundering regs though. Maybe that is also the reason for S&S ISAs
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
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