Will a tidal wave of ISA cash significantly reduce P2P rates

Since I'm a simple man, can someone explain in simple terms...

1. If I have my planned 16/17 allowance of £15k in a non ISA Savings Account, can I transfer pieces of this money into 3 different p2pisa's or does it have to be all in one place?

2. If I have £15k in an ISA that holds shares, can I sell these shares and transfer this money into a p2p isa?

AFAIUI They are wrong or they didnt understand the question/gave an answer to a different question than what you meant. (Disclaimer - not a financial advisor or professional, this is not advice)

For a start you can have 2 different ISA accounts currently each year - cash and shares

Second while you can only open one of each with new money each tax year you can move previous years money to another provider, so if you did that each year you would have multiple accounts

Third, you can move part of a previous year's money to another provider, so that would immediately mean you would have two accounts for a previous year, plus the one for that year (and the same for shares in theory) and you could do that as many times as you like AIUI

This is from the Which site

Limits on active Isas

Active Isas are those which have had funds transferred in during the current tax year. You can transfer funds between Isa providers as often as you like, but bear in mind that you can only have two active Isas (one for cash and one for stocks and shares) open at a time.

This means, while you can transfer ALL your funds from an active Isa to a different provider, you can't split these funds between different providers. Funds from inactive Isas can be split between more than one provider if you so wish.

Assuming the rules stay the same for PISA then they would be a third type (actually 4th as there is also a life insurance ISA) [Correction 5th, forgot the Help to Buy ISA which are a type of cash ISA but have slightly different rules on how much you can invest, but still count towards overall allowance]

Edit: in the banks defence, in the case of high street banks they seem to be very focussed on their own products and generally uninterested in competitors products. Every time I get asked to discuss my financial needs some of the stuff I mention as being offered by competitors, as I politely explain why I dont need their various products, they appear totally unaware of. Maybe thats just me.

This is what I plan to do for tax year 2016-17. I will open a number of PISAs (to use your acronym) one for each platform (currently I am thinking of 4 or five). They will receive old money from previous years which is currently held in a cash ISA (HSBC).

If I want to add new money in 2016-17, I will either add it to the cash ISA or use one of the PISAs (unless I am allowed to split my allowance like with Cash ISA / Share ISA).

I hope it will work as it will spread a bit the risk.

Possibly, but then look at the reply I got before:

p2pindependentforum.com/post/83512


Am I perhaps confusing ISA Manager with an ISA account?

ilmoro:  Thanks for that explanation.  Here's another situation to scratch your head over...

What about people like me that opened an ISA a few years ago with someone like HL?  It's just a single account, and every year since I opened it I've added the current year's allowable contribution, so I have one account containing multiple years' contributions.

I think that makes it an 'active' account at the moment (because of my 2015/16 contribution), but it will become a 'prior years' account on 6/Apr/16.  If I then were to add my 2016/17 contribution, that would make it an 'active' account again.  It would appear, therefore, that if I delay making my 2016/17 contribution until after I've transferred out money to various new P2P ISAs I can spread my prior years' ISA money across a variety of IFISAs.  Once I've done that, I then can make my 2016/17 contribution.

Does that sound like a feasible way to proceed?

No. The £15,400 allowance could be paid into any combination of cash, S&S and IF ISAs during the tax year but you could only have current year money with one manager for each type. If SavingStream offered an IFISA and you directly paid £15k into that then you couldn't put any current tax year money into any other IFISA. You could instead put your money into an IFISA manager that allowed investing at more than one P2P platform and it appears that at least one is planning to do this. The limit is one ISA manager for each type, not one P2P platforms for each type.

If you were instead to pay that same money into any ISA on 5 April, in this tax year, you could use transfers to spread it among a hundred different IFISAs if you wanted to in the next tax year, because it would all be past year money and the one of each type of ISA manager rule only applies to current tax year money.

The proposed rules on flexible ISAs will allow withdrawing and redepositing of cash from cash, S&S and IF ISAs without the redeposited amounts counting towards that year's subscription. They do require the replacement deposit to be with the same ISA manager. The original account could allow withdrawing and redepositing say £45k of past and current year money provided it's all done in the same tax year. After a transfer of current year money the new place can accept only up to the current year's limit but the old place can still accept the balance of the withdrawn past year money until the end of the tax year, when this redeposit entitlement vanishes. 6.77 on page 7 is where the most interesting bits of the description start. A manager isn't required to make their accounts flexible if they don't want to. This doesn't affect the one of each type rule for current year subscriptions, I'm just giving more detail on what ilmoro wrote, which might have implied that the amounts were limited to the current year subscription level, when they aren't.

While I'm imperfect, unlike retail bank staff I've actually read the guidance notes for ISA managers and all of the regular update notices explaining them. Don't trust retail bank staff to get anything right other than what their own bank offers and they will often get the rules on that wrong as well, particularly when it comes to changes of tax year.