ISA’s

Dumb question if i may…

Say i opened an ISA in the last tax year with the maximum allowance in it. If i want to keep saving on a regualr basis now its a new tax year can i keep adding to that account or do i have to open a brand new seperate ISA account for this tax year.

I sure the answer is obvious – just not to me 🙂

https://www.moneysavingexpert.com/savings/best-cash-isa/#what

New ISA. What you can do with the old one is ISA TRANSFER it (you don’t move the money into and out of a personal account, it transfers using a special process that preserves its tax free status). But at the end of the tax year that year’s ISA is essentially frozen.

You can keep adding to it. You don’t need to open a new one. You might need to “sign” a declaration that you haven’t/won’t be making any contributions to any other ISAs of the same type in the current tax year.

You shouldn’t need to transfer. But it might be worth considering if you can get a better rate elsewhere.

Thanks Aidy. Thats what i hoped – i only opened the account in march so rate is ok – seemed a hassle to have to open a brand new account for this year.

I did read that MSE link previously but was still unclear.

yeah, for example you can put 20k into an ISA on march 29th, and put another 20k into the same ISA on april 6th as its a new tax year.

But then you are maxed out for another 12 months for any ISA, but you can then put another 20k in april 6th 2025… so if you are worried about paying tax on interest on other money in other savings, you can put up to 50k into premium bonds.

If you have more money than that, then you might be best off talking to a financial advisor.

Some ISAs don’t allow ‘transfers in’, what this refers to is porting an ISA from one provider over to another ISA provider, you can still transfer money in from your current account, or a regular savings account, etc. just not from one ISA to another one, as long as you don’t put more than 20k a year into any ISA, as that’s the max.

If it was a fixed rate ISA you may only have been allowed to put in the initial amount within the first X days – best to check the T&Cs or speak to your provider.

You might need to “sign” a declaration that you haven’t/won’t be making any contributions to any other ISAs of the same type in the current tax year.

Thats changed this year, you can have many ISAs of the same type, but your overall ISA savings limit remain at £20k across all accounts within the tax year.

Plus potentially extra over and above the £20k if Hunt gets this ‘British ISA’ or whatever its called going.

Also, its worth sticking a quid in a LISA if you’ve not purchaed you’re first home as there is an age limit to when you can open one of those, so might be worth thinking about.

The multiple ISAs in a year is about the only decent thing Hunt has done, means you can have ‘Kids Uni fees’ ISA, ‘NewBike’ ISA, ‘Grandads funeral costs’ ISA etc.

gets this ‘British ISA’ or whatever its called going

Word on the Financial street is that its a pretty poor investment vehicle unless you are being taxed on your other savings as the rate will track UK business performance which has been pretty low for years.   As with all things it’ll pay to read the small print.

https://www.which.co.uk/news/article/nsi-british-savings-bond-now-on-sale-is-it-worth-investing-aFrdQ8H2waRL

TL:DR  the British ISA is a fixed 3 year scheme that is not as competitive as other providers.

ISA’s

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New ISA

Harsh, but fair 😁

I thought ISAs were technically a one year standalone thing but multiple years may be wrapped up to look like one within a single platform.

This is how it appears with First Direct anyway. I have to formally apply for a new one each year (and eg promise that I haven’t also done it elsewhere), but the combined investments of past years are listed together.

The rules slightly changed this year as you can now have more than 1 supplier of an individual ISA type.

For example you have a Stocks and Shares ISA with Vanguard and one with Santander as long as you do not exceed the £20k annual limit (including your Cash ISA). Previous year’s ISAs can be transferred or if the rate is good keep them where they are

In simple terms every year you get a £20k tax-free limit on your ISA savings (ignoring the new British ISA which is an additional £5k allowance)

That link doesn’t sound like the 5k British isa that was being talked about.. It sounds more like a a regular savings account?

It’s important to note that interest paid on British Savings Bonds is not tax-free.

And

Savers can pick from the Guaranteed Growth Bond (paying 4.15% AER) or the Guaranteed Income Bond (paying 4.07%) and invest between £500 and £1m.

As a more normal type of savings account it doesn’t sound very interesting given the interest rate and that it’s taxable.

This is how it appears with First Direct anyway.

Tuesday I opened the 5% ISA at Cynergy bank transferring last years 3.75% ISA funds into it and closing that on the way.  The whole process was done in 10mins on a computer and then I got email confirmation (doubly confirmed by me logging in again) 10 minutes later.

Now I just need to earn some money to put in it….

This is how it appears with First Direct anyway. I have to formally apply for a new one each year (and eg promise that I haven’t also done it elsewhere), but the combined investments of past years are listed together.

I guess it must depend on the provider? I have a chip ISA and I just keep putting money into it as long as it’s not more than 20k a year.

For example I put some in march and a bit more a few days ago. I don’t have any other ISAs, but they didn’t ask, either.

When transferring last years ISA to this years ISA do you still have the full £20k allowance for this year?

Yes new subsription is on top of transfer value

British ISA is unlikely to see the light of day either, its reckoned that the earliest date this would arrive is April 2025 and there the matter of a general election between now and then.

A really useful feature with some providers is the ‘flexible ISA’ whereby you can put your £20k in, then take some or all of it out (say in an emergency) then replenish it before the tax year end without exceeding your annual allowance.