Launch of IFISA

fundingsecure - you seem to be conflating "open" and "subscribe" in your interpretation of the guidance. "Subscribe" and "subscriptions" have a very specific definitions in the guidance notes and ISA Regulations. Your interpretation is correct for those who open and subscribe to your ISA - they will not be able to open and subscribe to any other IF ISA in this tax year. However, if they open, but do not subscribe to your ISA (which would be the case if they transfer in previous year subscriptions only), then they can also open and subscribe to an IF ISA elsewhere. If they open and subscribe to your ISA, then they can open an IF ISA elsewhere providing that they do not subscribe to it in the same tax year.

Transfer of current year subscriptions results in the subscriptions being treated as if they were made to the receiving ISA, and would therefore count as subscribing to the receiving ISA in the current tax year. Transfers of previous year subscriptions, between ISAs of any type (although some special restrictions exist for LISAs), do not count as subscriptions in the current tax year.

This is required by the ISA regulations. All ISAs (and ISAs of all types) must permit transfers out.

This is standard terminology on xISA accounts. 'Subscribe' in this context means 'fund with new ISA money' i.e. money coming out of this years ISA allowance.

Just looked at Lanbay, their site says there's no fee?

I wouldn't judge FS too harshly. I've seen plenty of examples of major banks giving customers incorrect information in relation to the ISA rules. This discussion is stretching FS well beyond what it would need to know in order to operate its own product within the guidelines. The T&Cs and declarations look correct to me, so I can forgive FS for not all being fully au fait with what we can and can't do in the greater scheme of things. It is for us to make sure we keep within the rules outside of FS, and for HMRC to check we are not subscribing to invalid combinations of ISAs when they receive the annual returns from ISA managers.

Guidance notes for ISA Managers

11.6 Investments and/or cash transferred are not new subscriptions for the purposes of the overall subscription limit.

There are also clear circumstances where you can open more than one IFISA for current year money (but not have current year money in them at same time). If you transfer your current year IFISA (full amount required) to another type of ISA (Cash/S&S) then under the rules that  IFISA would no longer count as your one IFISA for the current year so you could therefore open and subscribe to another IFISA with another provider.  So if you subscribe to a LLI IFISA this year, you could tansfer it to a Cash ISA and then subscribe to a FS IFISA as if the LLI never existed.

www.thisismoney.co.uk/money/saving/article-2120641/What-ISA-transfer-rules-I-stop-rate-crashing.html (cash isa discussed but true for all 3 types [Lisa slightly different])

The basic rules on Isa transfers

- You can transfer your money from one cash Isa provider to another, as long as your chosen provider will accept transfers.

- You can transfer a cash Isa opened in the current tax year (April 2014 to April 2015)*(April 2017 to April 2018),  but you have to transfer the whole lot to the new provider.

- On cash Isas taken out on or before April 5, 2014*,April 5, 2017 you can transfer part or all to the new provider. You can transfer different amounts or parts to as many providers as you like, as many times as you like.

- You can even split the money between variable rate and fixed rate deals. However, not all providers accept 'partial' transfers.

Edit the section FS quotes is from the start of the guidance covering ISA opening, the section on transfers is towards the end.

* Note article from 2015 so dates correct at time of writing but should be substituted with current dates