mikes1531
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Post by mikes1531 on Feb 27, 2016 21:51:05 GMT
I would recommend choosing a Cash ISA that will become a "flexible" Cash ISA in April 2016. Not all Cash ISA's will be "flexible" Cash ISA's. The benefit of a flexible Cash ISA is that it allows you to withdraw cash and return the cash within the same tax year. This hasn't been possible up to now. It doesn't look as if many P2P platforms will be ready for IFISA's in April, so a flexible Cash ISA will allow you to invest in P2P outside of the ISA without losing your allowance, just remember to put the money back in your flexible Cash ISA before April 2017. : If you're not going to invest the money within the flexible Cash ISA until IFISAs become available later in the tax year, why bother to put the money into the account in April only to take it out immediately so that you can invest it in P2P while waiting for an IFISA? Why not just wait and open the IFISA when it becomes possible to do so? Am I missing something?
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sqh
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Before P2P, savers put a guinea in a piggy bank, now they smash the banks to become guinea pigs.
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Post by sqh on Feb 27, 2016 22:07:47 GMT
I would recommend choosing a Cash ISA that will become a "flexible" Cash ISA in April 2016. Not all Cash ISA's will be "flexible" Cash ISA's. The benefit of a flexible Cash ISA is that it allows you to withdraw cash and return the cash within the same tax year. This hasn't been possible up to now. It doesn't look as if many P2P platforms will be ready for IFISA's in April, so a flexible Cash ISA will allow you to invest in P2P outside of the ISA without losing your allowance, just remember to put the money back in your flexible Cash ISA before April 2017. : If you're not going to invest the money within the flexible Cash ISA until IFISAs become available later in the tax year, why bother to put the money into the account in April only to take it out immediately so that you can invest it in P2P while waiting for an IFISA? Why not just wait and open the IFISA when it becomes possible to do so? Am I missing something? My post was in response to another post, without the continuity it may not make sense. It refers to this year's ISA allowance, not next year's. Essentially put this year's ISA allowance in a flexible ISA and you can withdraw it next year. Put this year's ISA allowance in a non-flexible ISA and you can't.
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mikes1531
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Post by mikes1531 on Feb 27, 2016 23:02:49 GMT
It refers to this year's ISA allowance, not next year's. Essentially put this year's ISA allowance in a flexible ISA and you can withdraw it next year. Put this year's ISA allowance in a non-flexible ISA and you can't. : Are you sure about how the 'flexibility' works? I thought it meant you could take current year money out and put it back without penalty as long as you did that in the same year. I didn't think you could withdraw money from a 2015/16 ISA during 2016/17 and put it back later in 2016/17.
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pikestaff
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Post by pikestaff on Feb 28, 2016 7:47:28 GMT
It refers to this year's ISA allowance, not next year's. Essentially put this year's ISA allowance in a flexible ISA and you can withdraw it next year. Put this year's ISA allowance in a non-flexible ISA and you can't. : Are you sure about how the 'flexibility' works? I thought it meant you could take current year money out and put it back without penalty as long as you did that in the same year. I didn't think you could withdraw money from a 2015/16 ISA during 2016/17 and put it back later in 2016/17. Correct. The new flexibility to withdraw and replace funds is within the tax year only.
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bababill
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Post by bababill on Feb 29, 2016 0:26:34 GMT
Either way a cash ISA in 2015/2016 (this year) can be transferred
I quote:
'Good news for RateSetter investors – from 6 April, anyone who already has a cash or stocks and shares ISA will be able to transfer all or part of their balance over to an Innovative Finance ISA (IF ISA) and continue to earn interest tax-free.
What that means in practice is that if you have, say, £50,000 in a cash ISA, you can transfer all or a portion of that to an IF ISA – and remember, that is in addition to being able to invest a further £15,240 from April this year."
So is anyone else opening a cash ISA this year with the sole intention of transferring to IFISA?
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Post by lynnanthony on Feb 29, 2016 1:30:11 GMT
So is anyone else opening a cash ISA this year with the sole intention of transferring to IFISA? Sort of. I have a moribund cash ISA from several years ago that currently sits with a few thousand pounds in it. I'm going to top it up with £15k this month ready to transfer it into an IF ISA.
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sqh
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Post by sqh on Feb 29, 2016 3:14:30 GMT
sqh : Are you sure about how the 'flexibility' works? I thought it meant you could take current year money out and put it back without penalty as long as you did that in the same year. I didn't think you could withdraw money from a 2015/16 ISA during 2016/17 and put it back later in 2016/17. Correct. The new flexibility to withdraw and replace funds is within the tax year only. I believe flexibility allows you to take out funds from previous tax years. So you can withdraw money from a 2015/16 ISA during 2016/17 and put it back later in 2016/17. This short video does say "if your ISA is flexible, the same flexibility will apply to the savings you made in previous tax years"www.coventrybuildingsociety.co.uk/savings-accounts/personal-savings-allowance-and-flexible-ISAs.aspx
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tomtom
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Post by tomtom on Feb 29, 2016 4:05:11 GMT
As an alternative to a cash ISA you could open a Hargreaves Lansdown Stocks and Shares ISA . Invest in say a Property Trust Fund which typically returns around 0.5% per month at the momment. HL have no dealing fees on Funds (Unit trusts, OEICs, PAIFs etc) and most have no spreads either. I think there would be a transfer out charge to a different ISA supplier. I do have a poorly performing HL S&S ISA (about zero growth since 2009). I will be selling down all my holdings and putting them in a flexible Cash ISA. Becarefull if I remember correctly HL will charge you for transferring an ISA from them to another provider so check HL small print first.
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sqh
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Post by sqh on Feb 29, 2016 5:50:31 GMT
I do have a poorly performing HL S&S ISA (about zero growth since 2009). I will be selling down all my holdings and putting them in a flexible Cash ISA. Becarefull if I remember correctly HL will charge you for transferring an ISA from them to another provider so check HL small print first. I think they charge £25 to transfer out and another £25 if you actually close the account. For me that's less than one week's interest on SS. A no brainer. My Stocks & Shares ISA has produced roughly zero return in 7 years. On SS that should double in 7 years time.
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pikestaff
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Post by pikestaff on Feb 29, 2016 7:31:59 GMT
Sorry, I've had another look at the rules. You are right. The withdrawal and subsequent replacement must in the same tax year but there is nothing to prevent the withdrawal being of previous years' funds. Your idea does require you to have enough spare cash that you can re-fill your cash ISA by the end of the tax year - and then presumably, if the rates are still cr*p, take it out again after 6 April and repeat the process ad infinitum. Unless (like most ordinary folk) you are not rich enough to use your full ISA allowance every year, in which case you only need to do partial repeats for X years, depending on how much otherwise-unused allowance you have at the end of each year.
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kermie
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Post by kermie on Mar 5, 2016 10:33:58 GMT
So forgive me if I have mis-read the situation, but does this mean that on April 7th, I could:
i) transfer all old ISA money to a flexible ISA
ii) deposit 2016-2017 ISA money into a flexible ISA
iii) withdraw the lot (perhaps leaving a £ in each to keep the accounts open if need be)
iv) invest it in P2P
v) before April 6th 2017, sell out of P2P and put it all back into my flexible ISA accounts
If true, this seems like a possible way of moving "ISA-allocated money" into P2P before IF-ISAs are available (since it looks like they may well be delayed), albeit of course tax will have to be paid.
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ilmoro
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Post by ilmoro on Mar 5, 2016 10:48:14 GMT
So forgive me if I have mis-read the situation, but does this mean that on April 7th, I could: i) transfer all old ISA money to a flexible ISA ii) deposit 2016-2017 ISA money into a flexible ISA iii) withdraw the lot (perhaps leaving a £ in each to keep the accounts open if need be) iv) invest it in P2P v) before April 6th 2017, sell out of P2P and put it all back into my flexible ISA accounts If true, this seems like a possible way of moving "ISA-allocated money" into P2P before IF-ISAs are available (since it looks like they may well be delayed), albeit of course tax will have to be paid. The issue will be finding a Flexible ISA as a lot of providers have reported already said they wont be offering one.
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dawn
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Post by dawn on Mar 5, 2016 11:06:16 GMT
So forgive me if I have mis-read the situation, but does this mean that on April 7th, I could: i) transfer all old ISA money to a flexible ISA ii) deposit 2016-2017 ISA money into a flexible ISA iii) withdraw the lot (perhaps leaving a £ in each to keep the accounts open if need be) iv) invest it in P2P v) before April 6th 2017, sell out of P2P and put it all back into my flexible ISA accounts If true, this seems like a possible way of moving "ISA-allocated money" into P2P before IF-ISAs are available (since it looks like they may well be delayed), albeit of course tax will have to be paid. The issue will be finding a Flexible ISA as a lot of providers have reported already said they wont be offering one. Assuming you could find a Flexible ISA - the other problem will be being sure you can sell out of all the P2P before the end of the tax year to get it all back into the ISA in time. Some platforms have fairly fluid SM's at the moment but if lots of people were trying to sell in early April you may find it less easy to liquidate your funds.
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SteveT
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Post by SteveT on Mar 5, 2016 11:21:35 GMT
A faster route into P2P ISA investment could be the FC SME Income Fund (investment trust), which was available yesterday at a 6.5% discount to NAV
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agent69
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Post by agent69 on Mar 5, 2016 11:47:13 GMT
So forgive me if I have mis-read the situation, but does this mean that on April 7th, I could: i) transfer all old ISA money to a flexible ISA ii) deposit 2016-2017 ISA money into a flexible ISA iii) withdraw the lot (perhaps leaving a £ in each to keep the accounts open if need be) iv) invest it in P2P v) before April 6th 2017, sell out of P2P and put it all back into my flexible ISA accounts If true, this seems like a possible way of moving "ISA-allocated money" into P2P before IF-ISAs are available (since it looks like they may well be delayed), albeit of course tax will have to be paid. If I have understood your suggestion correctly, then it doesn't work because you will have exceeded your annual allowance. If step 4 takes the money outside of an ISA wrapper then you're stuck. You have already used your 2016 - 2017 allowance in step 2, so would be barred from paying any other 'new 'money back into a flexible ISA account.
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