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Help needed with ISA rules please

by spidermev 02 March 2010 |

8 comments | Love

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Hi All,
I've searched the Q&A and can't quite find what I was looking for so here goes:
If I open an ISA now (Feb 2009/2010 year) and don't use up the allowance by the end of the financial year, I know I can carry on contributing for next years allowance but am I right in thinking that if I open a new one in 2010/2011 I can only contribute new money to the one I open that year, i.e. I can't spread the 2010/2011 allowance between 2 different CASH ISAs. Or is it the case that as soon as I use the one I open now (2009/2010) for contributions in 2010/2011 I'm committed to that one and cannot open another once I have made a contribution to the old one?
I hope that makes some sense, it was difficult to word! :)
Many thanks

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410

manzanilla posted
You can only have 1 cash ISA account for each year. You cannot split the 2010/11 allowance between two differnt accounts.
If you open an account now and don't use up your 2009-10 allowance, then if you contribute more money to it in 2010/11, that counts as your 2010/11 cash ISA, not using up the rest of this years allowance. And that will prevent you opening another cash ISA account in 2010/11.
Is that clear?
(Of course you can always move cash ISAs to different providers, but I don't think that was what you were asking, was it?)
manzanilla
Posted on 02 March 2010 | Love 3 loves Report
212

SoftwareBear posted
The important date is 6th April, the start of the tax year.
you can't run pay into two cash isa's concurrently in the same tax year.
only one active cash isa is allowed at any one time ... but you can transfer the funds through as many different providers as you like within a year (but you're unlikely to want to).
you can't carry over unused allowances from one tax year to the next.
you can open one before 6th April and put in a whole year's allowance then one after the 6th April and put in another tax years worth in the same calendar year ... but then you can't put more in until after 6th April the next calendar year.
Posted on 02 March 2010 | Love 1 love Report
24

spidermev posted
That is exactly what I wanted to know, thanks for that Manzanilla.
Now you mention it though, I assume you cannot move the ISA until the following year? I think you can only move ISAs for previous years?
Posted on 02 March 2010 | Love 0 loves Report
24

spidermev posted
Thanks SoftwareBear
Posted on 02 March 2010 | Love 0 loves Report
24

spidermev posted
So does that mean that if I find a better rate halfway through a year then the account needs to accept transfers in and then you can move the current year's cash ISA to another provider?
Posted on 02 March 2010 | Love 0 loves Report
804

MikeGG1 posted
It is better to consider an ISA as long-term savings as the short-term rates are pretty poor. On that basis you wouldn't be able to switch mid-contract.
If you switch new contributions mid-year, you have to switch the other contributions paid during the tax year as well.
Mike
Posted on 02 March 2010 | Love 0 loves Report
212

SoftwareBear posted
I know MikeGG1 will disapprove ... but yes ... you are allowed to move a Cash ISA between providers as much as you like ... so if you just miss a good deal you could change your mind and move it again within the year.
http://www.hmrc.gov.uk/ISA/transfer-isa.htm
Posted on 02 March 2010 | Love 2 loves Report
24

spidermev posted
Awesome stuff, thanks a lot for all the info guys. Everything I needed to know
Posted on 02 March 2010 | Love 1 love Report

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