OT : ISA advice please

If by "can I open" you mean "can he open" (i.e. you on his behalf), then the answer is no.

You can have as many different kinds of ISAs as you like. You just can't pay into more than one in any one tax year, unless they are different KINDS of mini ISA. It makes no difference whether they're with the same or different companies. So you can pay into a mini cash one and into a mini stocks one in the same year, but if you pay into a maxi, you can't pay into any other ISA in the same year.

You can't because he has contributed into the maxi this year.

Bitstring , from the wonderful person steeler said

You can't contribute to both a maxi and mini ISA in the same tax year. If you have paid £300 into a Maxi ISA, your only option is to contribute some more to that one (whether it goes into stocks/shares, cash, or whatever) this tax year.

=Next= tax year (after 6/Apr) you (or rather 'he') can open a new ISA (or ISAs, if you want mini cash and mini stocks/shares) .. but not if you make any new contributions to existing ones. (re-investing dividend income earned inside the ISA doesn't count as a new contribution).

Is he even a tax payer? If not any sort of ISA may make little sense, given you can get 4.5% with ING Direct (online).

You might also want to check with the uk.legal folks - I imagine that you, or she, ought have power of attorney, or something similar, if you want to play with his finances without leaving yourself open to considerable legal hassle.

That is a shame. Currently he pays 250 a month into the maxi by direct debit. If I cancel the DD (so no money is being paid to that maxi ISA in tax year 2004/2005) can he then transfer the maxi to another company and invest next years (2004/2005) allocation with the new company. Or even close the current maxi (with no money being paid in after 5 April 2004) and open a new mini cash isa for 2004/2005 starting from scratch?

It will take a week to close the current maxi - so if he cannot own two at once (even if he has stopped paying into one) I guess that means he loses his tax free allocation for next year too?

Would it be possible to telephone the current maxi supplier and have them not roll over the account into the next tax year (even though it will not close by 5 April) - would that help anything at all?

cheers (I wish I had been asked to look into this a month ago - no deadline probs then ;-) ).

Not, if he has paid into his maxi ISA this year.

Regards Sunil

If you cancel the direct debit so no money is paid into his existing Maxi ISA in the next tax year, then he can open a maxi ISA with another company.

His existing Maxi ISA can be left where it is, transferred or closed..

Next year, as long as he doesn't contribute to his current Maxi, he can either open:

a) a new Maxi ISA or b) a Cash mini ISA and/or a Share Mini ISA

You can own multiple Maxi ISA's at once - but you can only contribute to/open one a tax year.

No, but if you don't pay into it - it wont be "rolled over"

Regards Sunil

Thanks, will sort that out in the morning

cheers all

Yup, sorted now. Cheers all, great advice.

There is an unfortunate confusion associated with the word "open". Only where opening is tied to making an initial deposit at the same time does "opening" as such have any real implication.

In theory you can open as many ISAs of all kinds as you like. The only constraint is that you must not contribute to more than one of each kind in any one tax year, or to a maxi and any other.

Yes.

It makes no difference whether you close the old one or keep it open. So long as you (he) don't (doesn't) contribute to the old one next year, he can contribute to whatever he likes next year.

He can even transfer the old one to a new one of the same kind in the same year. So long as no new contributions are going in (transfers don't count as contributions), all will be well.

But he can "own" as many as he likes.

There is no such thing as rolling over of an "open" status, since "being open" is not relevant for tax purposes. Only the adding of new investment is.

The only thing you need worry about is making sure the DD is stopped in time.

Ideally you'd presumably wish to start a new mini cash ISA in 2004/05 and also see if you can transfer the existing maxi stocks into a new mini stocks ISA (not sure if that's possible, but it should be). But that transfer would only be of use if you think the new provider will perform better than the old. If you're moving out of shares, and the existing provider performs adequately, just resign yourself to pulling funds out of it at the same rate you can re-invest in MCI. If the maxi performs particularly badly, you may as well empty it and bung the proceeds in a non-ISA high interest accuont (e.g. ING) or into gilts.

In theory, the number of ISAs you can have is limited by the number of years they have been in existence.

That's in practice, because normally you do not open one without also making at least a token contribution at the same time.

Ronald Raygun wrote on Sat, 3 Apr 2004

I think what contributes to any uncertainty is the fact that the regulations allow you to make contibutions in a new tax year to an existing ISA, without any further formalities, but only if you've contibuted to it in the previous tax year. In that case, there's a temptation to use the adjective 'open'.

When I checked an on-line statement for an ISA to which I hadn't contributed last year, it was tagged as 'inactive', which itself had me worried for a few seconds.