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Main site > Forums > Essential Money > Savings & Investments > ISAs & Tax-free Savings > Transfer of Help to Buy (with Cash ISA wrapper) t...
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      oadey89
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    • By oadey89 13th Jul 17, 11:02 PM
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    Transfer of Help to Buy (with Cash ISA wrapper) to Lifetime ISA
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    • 13th Jul 17, 11:02 PM
    Transfer of Help to Buy (with Cash ISA wrapper) to Lifetime ISA 13th Jul 17 at 11:02 PM
    Hi

    I have had on the forum and various threads and have been unable to find an answer to my question so have started a new thread - apologies if I have missed it.

    Last financial year I opened a Help to Buy ISA with Nationwide - I chose Nationwide (in spite of better interest rates being available) because it was one of any a couple of suppliers who allowed a Cash ISA wrapper where the remainder of my ISA allowance could be invested.

    Ultimately, however, I want to open a Cash LISA and transfer funds from my Help to Buy ISA across. Because I am looking to purchase a property in the next few years I though a Cash LISA would be more appropriate than a Stocks and Shares ISA. But because no suppliers had a Cash LISA product ready to go in April 2017 I continued to make contributions to my Help to Buy ISA with Halifax. Now Skipton are offering a Cash LISA I have attempted to transfer my Help to Buy ISA across to this product.

    However, Nationwide have contacted me to confirm I can't transfer the Help to Buy ISA to Skipton unless I also transfer the Cash ISA as well. I understand that previously that the Help to buy ISA and the Cash ISA wrapper had to be with the same supplier but I was under the impression that under ISA rules for the current tax year I can hold a Cash ISA and Lifetime ISA (in particular with different suppliers) so long as my total subscription doesn't exceed 20,000 pounds. If I'm correct then Nationwide shouldn't be able to block my transfer.

    Please could someone help me - who is interpreting the ISA rules incorrectly - is it me or Nationwide.

    Thanks in Advance
    Oliver

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      eskbanker
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    • By eskbanker 13th Jul 17, 11:32 PM
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    • #2
    • 13th Jul 17, 11:32 PM
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    • 13th Jul 17, 11:32 PM
    Have you paid anything into the non-HTB cash ISA since 6 April?

    If so, then my understanding is that Nationwide are right, in that all current year subscriptions to ISAs of any given type have to be kept together. As HTB is a just a subset of cash ISA, then this means that all of your 2017-18 cash ISA (including HTB) subscriptions need to be transferred (or all left together where they are of course).

    However, if you've only paid into the HTB and not the other one since 6 April then I'd disagree with their stance....

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    • By oadey89 13th Jul 17, 11:41 PM
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    • #3
    • 13th Jul 17, 11:41 PM
    • #3
    • 13th Jul 17, 11:41 PM
    Thanks for your reply eskbanker.

    Yes I have put money in the HTB and the Cash ISA since 6th April. Although I perhaps wouldn't have done had I not misinterpreted the rules.

    Assuming I transfer the HTB one to a Lifetime ISA with Skipton and the remaining Cash ISA to a Cash ISA with Skipton will this then "break the link" between the two accounts. That is, in the future will I be able to move the Lifetime ISA account independently of the Cash ISA account.

    It is my understanding that although HTB is just a subset of a Cash ISA - that the Lifetime ISA is a separate entity all together. Is this correct?

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      Ed-1
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    • By Ed-1 13th Jul 17, 11:54 PM
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    • #4
    • 13th Jul 17, 11:54 PM
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    • 13th Jul 17, 11:54 PM
    “
    Thanks for your reply eskbanker.

    Yes I have put money in the HTB and the Cash ISA since 6th April. Although I perhaps wouldn't have done had I not misinterpreted the rules.

    Assuming I transfer the HTB one to a Lifetime ISA with Skipton and the remaining Cash ISA to a Cash ISA with Skipton will this then "break the link" between the two accounts. That is, in the future will I be able to move the Lifetime ISA account independently of the Cash ISA account.

    It is my understanding that although HTB is just a subset of a Cash ISA - that the Lifetime ISA is a separate entity all together. Is this correct?
    Originally posted by oadey89 ”
    As Nationwide ISAs are flexible, you could withdraw current year subscriptions from the cash ISA and they are treated as never having been made. You are then free to transfer the current year funds in the H2B ISA together (alternatively, you could just transfer previous year funds from the H2B ISA and send the rest directly into the LISA as new contributions). You can pay into both H2B and LISAs in the same year.

    “
    But because no suppliers had a Cash LISA product ready to go in April 2017 I continued to make contributions to my Help to Buy ISA with Halifax.
    Originally posted by oadey89 ”
    You also mention a Halifax H2B ISA - did you mean that?
    Last edited by Ed-1; 14-07-2017 at 12:04 AM.

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    • By oadey89 14th Jul 17, 12:04 AM
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    • 14th Jul 17, 12:04 AM
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    • 14th Jul 17, 12:04 AM
    Thanks for your reply Ed-1, that's really useful.

    Halifax was a typo - I meant Nationwide, sorry if that added to the confusion!

    So I'll withdraw the funds from Cash ISA with Nationwide leaving me to transfer my full HTB across to the Skipton LISA. Then I can add the funds withdrawn from my cash ISA into the Lifetime ISA (as this is still below the 4000 pound limit for the year).

    Then going forward once I max out the Lifetime ISA am I right in thinking I can open a Cash ISA with any supplier? I.e. This wouldn't have to be with Skipton.

    Or better still I have another Cash ISA with Virgin Money for previous tax years - can I restart contributing to that as my Cash ISA for this year as I will have effectively undone my Nationwide Cash ISA contributions for this year.

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    • By Ed-1 14th Jul 17, 12:08 AM
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    • #6
    • 14th Jul 17, 12:08 AM
    • #6
    • 14th Jul 17, 12:08 AM
    “
    Thanks for your reply Ed-1, that's really useful.

    Halifax was a typo - I meant Nationwide, sorry if that added to the confusion!

    So I'll withdraw the funds from Cash ISA with Nationwide leaving me to transfer my full HTB across to the Skipton LISA. Then I can add the funds withdrawn from my cash ISA into the Lifetime ISA (as this is still below the 4000 pound limit for the year).

    Then going forward once I max out the Lifetime ISA am I right in thinking I can open a Cash ISA with any supplier? I.e. This wouldn't have to be with Skipton.

    Or better still I have another Cash ISA with Virgin Money for previous tax years - can I restart contributing to that as my Cash ISA for this year as I will have effectively undone my Nationwide Cash ISA contributions for this year.
    Originally posted by oadey89 ”
    Yes you're right.

    You could even pay into a new H2B ISA starting with £1,200 as they're the best cash ISA rates around.

    Are you aware that any H2B contributions from before 6th April 2017 can be transferred into the LISA as well as another £4,000 this year (which is reduced by any post-6th April 2017 H2B contributions)?

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