alanh
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Post by alanh on Feb 13, 2020 9:47:48 GMT
I've done quite a bit of transferring ISA's out of IFISA's into stocks and shares. Its fairly easy. You can only transfer over the cash element of the IFISA, the part that is still invested in loans stays where it is. I have S&S accounts at Hargreaves Lansdown and Vanguard. HL allow partial transfers in from IFISA's and are generally pretty quick. Vanguard do not allow partial transfers, they can only accept the whole thing, so you can only transfer directly to Vanguard if you manage to liquidate your entire IFISA into cash - often not possible. You can effectively do a partial transfer to Vanguard by doing a partial transfer to Hargreaves Lansdown, then buy the relevant Vanguard funds you want on the HL platform and then get those funds transferred over to Vanguard. A bit tedious, but easy to do.
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Post by shanghaiscouse on Feb 13, 2020 10:00:13 GMT
True, but this is why ISAs are not suitable for so-called innovate finance products, and you have to ask why they were encouraged.
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corto
Member of DD Central
one-syllabistic
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Post by corto on Feb 13, 2020 10:50:20 GMT
ISAs were originally introduced to encourage people to save. That's in principle a long term thing and theoretically p2p should be good for it. I believe that was the idea when IFISAs were introduced, too. Transfers were probably not expected to be frequent. Most people don't change their cash or S&S providers often either. It is a peculiarity of p2p that requires transfers (to diversify widely, to run away from providers that start looking pale ...)
The problem seems to come from the current instabilities in p2p. As long as platforms don't converge on agreeable medium-term procedures there cannot be trust. As long as there is a high risk that the average platform is gone in 3 years time, I'd agree that p2p in ISAs is problematic. I would not have thought that 2 years ago.
I am quite optimistic that these instabilities can be overcome; however, the average returns will be lower than today, and the high-risk stuff may well not be available to retail investors anymore.
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Post by shanghaiscouse on Feb 13, 2020 13:58:45 GMT
Well yes, when first intoroduced nobody had any experience of P2P and how they would evolve, from being non-discretionary to what FC has become which is entirely discretionary. This information is now available, hence the HMRC should, in my opinion, consider scrapping this because it is another way of attaching unearned merit to the concept of "innovative finance".
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Post by esq on Feb 19, 2020 20:45:54 GMT
Once you go over £20K withdrawals you will hit a problem as I have found. My transfers started to be rejected because they are not marked as an ISA transfer by FC. My New ISA provider therefore stopped transfers in at £20k despite allowing transfers in.
reply from FC below
With regards to changing the way transfers out are processed we would not be able to signpost the withdrawal differently from any other withdrawal. The reference would remain the same which is 'FC Withdrawal'. This is because you are withdrawing from an ISA account and all ISAs with us have a general sort code and account number for Funding Circle as a whole with the only differentiating factor being the ISA reference. This ISA reference is for internal reference and is unlike in conventional banks where a sort code and account number and personal details can be matched across platforms.
If you continue to withdraw from this ISA directly to your Virgin Money ISA you will repeatedly encounter bounced withdrawals. Additionally since setting up this as your account for withdrawals we have changed our procedures and stopped allowing for investors to nominate ISAs as they repeatedly encounter this problem.
We only monitor internal subscription usages so if investors have reached or surpassed their limit elsewhere we are unable to tell or flag this when you withdraw.
Please nominate another bank account for future withdrawals to avoid this issue.
So your ISA wrapped funds will lose that protection as you withdraw them from FC.
Not good
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scooter
Member of DD Central
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Post by scooter on Feb 19, 2020 21:39:11 GMT
I might be misunderstanding you here but it sounds like you are just transferring available cash to a new cash isa which is fine up to 20k but you are losing any prior year isa shield _ what you need to do is transfer the available cash to a current account until you have built up a reasonable amount and then put it back in to FC, before 5th April and do a proper Isa transfer form to transfer prior year isa to another isa provider.
You might be able to set up an isa transfer request that transfers as and when the funds become available but I'm not sure on that.
Sorry if I misunderstood
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Post by shanghaiscouse on Mar 24, 2020 11:38:29 GMT
OK so I started this thread and only now after about 3 weeks do i have any update, I am transferring a previous year 18/19 innovative finance ISA from FC to IG. So now I got an email from FC saying that they received my request via IG (good) but that I have to wait for a "substantial" amount to become liquid before they will transfer it over, and then to transfer over the balance as it becomes liquid I will need to do a new form. I have been selling loans and manually withdrawing cash as quick as I can (i.e. painfully slowly) but I have no idea how much needs to be accumulated before they will send it over to IG. I will also ask them if I have the option to put more cash into the account (I am currently down to 14k so I could put another 6k in) to get them to transfer that across to IG and I can then at least preserve this previous year 18/19 ISA.
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Post by Ace on Mar 24, 2020 11:51:19 GMT
OK so I started this thread and only now after about 3 weeks do i have any update, I am transferring a previous year 18/19 innovative finance ISA from FC to IG. So now I got an email from FC saying that they received my request via IG (good) but that I have to wait for a "substantial" amount to become liquid before they will transfer it over, and then to transfer over the balance as it becomes liquid I will need to do a new form. I have been selling loans and manually withdrawing cash as quick as I can (i.e. painfully slowly) but I have no idea how much needs to be accumulated before they will send it over to IG. I will also ask them if I have the option to put more cash into the account (I am currently down to 14k so I could put another 6k in) to get them to transfer that across to IG and I can then at least preserve this previous year 18/19 ISA. You can certainly put back any cash you've withdrawn as FC ISA is flexible. It tells you how much on the summary page.
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Post by shanghaiscouse on Mar 30, 2020 14:15:43 GMT
OK so I have finally started being able to transfer my ISA allowance out of FC innovative finance ISA and into my IG brokerage stocks and shares ISA. I had started liquidating it and withdrawing the cash about 3 months ago so of the original 20k I only had 15k remaining. So i topped up the FC ISA with £2k and then transferred that £2k over to IG first to make sure it worked, and it did, so I will do another £3k and then I will have a total of £5k transferred. But following that, all I can do is wait for the £15k remainder of the loans to liquidate, which could take years. In other words, I would never put money into an innovative finance ISA again.
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Post by shanghaiscouse on Mar 30, 2020 14:19:41 GMT
I should have said, because I am expecting FC to collapse in the not too distant future, and as I have had my remaining loans up for sale for months now, then I withdraw anything that liquidates every day or so, run the balance on the ISA account down, then when I have say £1,000 of my ISA balance available I will transfer the £1,000 back into FC and same day transfer across to the IG ISA. I will keep my eye on this and not do it if FC appears to be teetering on the brink, but in my judgement I need to get every penny I can out now, even if that makes it a daily hassle.
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Post by Ace on Mar 30, 2020 14:34:29 GMT
OK so I have finally started being able to transfer my ISA allowance out of FC innovative finance ISA and into my IG brokerage stocks and shares ISA. I had started liquidating it and withdrawing the cash about 3 months ago so of the original 20k I only had 15k remaining. So i topped up the FC ISA with £2k and then transferred that £2k over to IG first to make sure it worked, and it did, so I will do another £3k and then I will have a total of £5k transferred. But following that, all I can do is wait for the £15k remainder of the loans to liquidate, which could take years. In other words, I would never put money into an innovative finance ISA again. I'm glad you've found a method that works, but it's hardly fair to tar all IFISAs with FCs smelly brush.
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Post by shanghaiscouse on Mar 30, 2020 14:55:54 GMT
It reflects my own personal risk appetite. I had not fully appreciated FC's business model when I first invested. Now I understand it, I will never touch the sector again!
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