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Post by glocal on Apr 10, 2018 12:15:00 GMT
I understand that you can move new funds up to 20k between IFISAs within a year without losing the ISA wrapper, but how can does it work with several years' worth of IFISAs? For example, suppose you move 40k from an old cash ISA created in 2017-18 into a Zopa ISA, and you already have 10k in a Zopa IFISA from last year.
a. Will there be two Zopa IFISAs or will the two pots be merged into one Zopa IFISA?
b. How can you later move the funds from the Zopa IFISA to a cash ISA or another IFISA? If you must sell on the secondary market, you will end up with 50k in cash.
Thanks.
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Greenwood2
Member of DD Central
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Post by Greenwood2 on Apr 10, 2018 13:30:03 GMT
I understand that you can move new funds up to 20k between IFISAs within a year without losing the ISA wrapper, but how can does it work with several years' worth of IFISAs? For example, suppose you move 40k from an old cash ISA created in 2017-18 into a Zopa ISA, and you already have 10k in a Zopa IFISA from last year. a. Will there be two Zopa IFISAs or will the two pots be merged into one Zopa IFISA? b. How can you later move the funds from the Zopa IFISA to a cash ISA or another IFISA? If you must sell on the secondary market, you will end up with 50k in cash. Thanks. a) They are one pot. I transferred some in last tax year. b) I assume you would end up with funds in your ISA holding (the same as if you stop lending in your ISA), for which you would then have to arrange an ISA transfer. Edit: I would check with Zopa before I did anything hasty though!
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Post by skint4achange on Apr 10, 2018 17:25:42 GMT
I understand that you can move new funds up to 20k between IFISAs within a year without losing the ISA wrapper, but how can does it work with several years' worth of IFISAs? For example, suppose you move 40k from an old cash ISA created in 2017-18 into a Zopa ISA, and you already have 10k in a Zopa IFISA from last year. a. Will there be two Zopa IFISAs or will the two pots be merged into one Zopa IFISA? b. How can you later move the funds from the Zopa IFISA to a cash ISA or another IFISA? If you must sell on the secondary market, you will end up with 50k in cash. Thanks. Just to clarify, even though you will have 50K in cash, it will still be classed as IFISA money.
You can transfer previous years money to anywhere, but you can only open 1 of each type of ISA (Cash, S&S and IFISA) in any one year.
But as you say that the Zopa ISA is from last year, you can transfer in from any previous years ISA contributions with no restrictions, and also open another IFISA for this year.
Your IFISA provider will keep you straight in any case. Just don't remove the cash and try to deposit it into an ISA as the transfer has to be done correctly otherwise the money is no longer tax free.
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Post by glocal on Apr 10, 2018 17:53:16 GMT
Just to clarify, even though you will have 50K in cash, it will still be classed as IFISA money. So, the key is that as long as the IFISA funds are loaned OR sitting in the IFISA holding, they remain in the ISA wrapper. That makes sense. Many thanks @greenwood2 and skint4achange .
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Post by skint4achange on Apr 10, 2018 17:54:59 GMT
Yes, DO NOT remove them from whichever platform you have the funds in UNLESS it is by official ISA transfer to another ISA/IFISA provider.
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rzys
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Post by rzys on Apr 10, 2018 21:12:11 GMT
All ISA providers have to classify funds as current (tax) year or previous years.
When you transfer between providers, the receiving ISA provides the application form, on which you have to specify whether the funds you are moving are current or previous year.
Current year funds have to be transferred all together. Previous year funds can be transferred in smaller chunks (if the providers both allow this)
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rambler
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Post by rambler on Apr 11, 2018 18:39:11 GMT
Another question on the same subject...
If I decided I want to move (say) £5000 of previous years ISA from Zopa to another provider and fill in a form (with the new provider) for this, how does it happen if I dont want to sell my loans early?
(a) Zopa waits until I have accrued £5000 in repayments and then sends over the full amount
(b) Zopa sends over repayments as I get them
Option (a) would obviously involve having lots of cash sitting my holding account for some time earning nil interest.
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Post by GSV3MIaC on Apr 11, 2018 19:27:10 GMT
I suspect c) (although it is up to Zopa I believe) .. if you don't have the cash available to transfer, they reject it back to the new ISA supplier with a 'insufficient funds' sticker. Just like writing a cheque without the cash to back it up. Best case they might liquidate loans to get to the funds, but if there was any discretion about what to sell, then I suspect they would not play that game.
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Post by Ace on Apr 11, 2018 22:55:37 GMT
I had a scan through Zopa's T's and C's. It seems to me that option C above is the one that will apply.
So, you will have to either:
1) stop reinvesting and wait for sufficient funds to accumulate in your IFISA holding account, then complete your new provider's transfer form.
Or
2) use zopa's Rapid Return Facility to liquidate sufficient funds into your IFISA holding account (for which you will pay a 1% fee), then complete your new provider's transfer form.
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