Silly question about ISAs

[Yamyamabroad]

I have googled this but ended up more confused. I had my first ISA last year which I then moved to a new ISA with the same bank. Are you actually able to have more than one ISA? For example, one opened in 2024 and then just left there accruing interest and then open another one in 2025 so you might end up with several over the years but only actively saving in to this year's. Told you it was probably a silly question 😜

I am confused by ISAs. I will lurk 🙈

I do not feel like a competent adult at times. Sigh.

Yes. I believe you can have multiple ISAs open, but you then have to make sure you don't go over the tax free limit. And I guess the question is, why would you have multiple ISAs? Why not transfer all your ISA money in to one with the highest interest rate?
Martin Lewis did a podcast all about ISAs in March. It's well worth a listen and I'm sure will answer all of your questions: https://www.bbc.co.uk/sounds/play/p0kzfdj4?partner=uk.co.bbc&origin=share-mobile

Yes, but you can’t pay in any more than £20k into them (combined) during the current tax year.

Yes you are allowed to open a new ISA each tax year. You can move your old ISAs to new providers.

Think of an ISA as a savings account that you can only put a certain amount into, with a tax-free wrapper. Any interest or growth inside that wrapper remains tax free. You can transfer the wrapped money to a different provider or leave it where it is.

You've posted in investments, but an ISA can be a stocks and shares ISA or a cash ISA. It sounds as though you have a cash ISA as you mention interest.

Yes @Yamyamabroad .

You can only pay into one ISA during a tax year. You can open a new one each new tax year to get the best rate. You can transfer one into another without impacting on the tax effectiveness.

They would still be multiple ISAs, but with the same provider. You have a different wrapper for each tax year.

It's the fact that anyone in public has a smart phone snapping away then posting stuff on SM for all the world to see...fine if you give permission, but that will not always be possible

Several reasons. You might want to split your money between a cash isa and a stocks & shares isa. Or you might want to put some of your money in a high interest fixed term isa and some in a flexible isa that allows you to withdraw and return with no penalty.

Yes, you can have multiple ISA's.

We each have several, opening a new one each year with the max investment then letting it sit there until maturity when it gets transferred to another ISA (which is different to opening another ISA).

This is not correct. It used to be, but not anymore.

You can now pay in pay in to multiple ISAs.

Not sure where the bits in bold came from. Not this thread!

I was actually responding to this…

And I guess the question is, why would you have multiple ISAs? Why not transfer all your ISA money in to one with the highest interest rate?

Ah yes sorry you are right. You can still transfer from one to another without removing the tax effectiveness, unless you withdraw.

Lots of experts on here but I need talking to like I am a 5 year old !!
Could I do this -
2023 - open an ISA, stick in 20000, then leave it there
2024 - open an ISA, stick in 20000 then leave it there - and so on.

If I can do that, have I lost that ability by transferring last years into a new one in April?
Thank you all so much

If you transferred last year’s ISA to another provider this year, you still haven’t used your 2025 ISA allowance, so you can open another one this year.

You only wouldn’t be able to do this if instead of transferring your 2024 ISA, you closed it then opened another one. Hope that makes sense!

Depends how you transferred it. If you withdrew all the money out of the first ISA, then went to open the new one with it, you’re using a new allowance.
If you open the new ISA and tick the transfer box for the new account to transfer funds from the old one that doesn’t use up and new allowance.
Think of the ISA allowance as £20k of cling film that you can put round money to keep it out of the taxman’s hand. You can split up the cling film and use it to wrap smaller chunks of money in different places, and you can move wrapped money without damaging the wrapper as long as you don’t unwrap it.

Yes you can have multiple ISA’a but you can only pay into one and the same tax year. So you can open a new one every April in the new tax year and pay into it, but you couldn’t pay into a second one.

You can open multiple ISAs and as of the 2024/25 tax year you can pay into multiple ISAs in one tax year.

This is incorrect. You can pay into as many as you like as long as you don't go over the limit.

Why are you opening a new one each year? If it is a fixed term ISA then usually you would have a set time to pay in then it would mature after a set time period. With an ordinary cash ISA there is no need to open a new one each year unless of course you are getting a better rate with the new one. If that was the case though you would be better transferring in your existing one as well as paying into it.
You can transfer any amount from an ISA to another ISA as long as the new provider accepts transfers in.

@rainbowunicorn Because the limit for each one might have been reached? We have stocks and shares ISAs and use our allowance each year.

@Yamyamabroad
Could I do this -
2023 - open an ISA, stick in 20000, then leave it there. Yes
2024 - open an ISA, stick in 20000 then leave it there Yes - and so on. Yes
If I can do that, have I lost that ability by transferring last years into a new one in April? No

2023/2024 tax year - open ISA 1 with £20k 2 year fixed term
2023/2024 tax year - open ISA 2 with £20k 2 year fixed term = £40k in ISAs
2024/2025 tax year - open ISA 3 with £20k, ISA 1 matures transfer to either ISA 3 or new ISA 4 = £60k in ISAs.

The key is to make sure existing transfers are “transferred” to the next ISA I.e. you don’t close an ISA you let the new provider transfer the money.

You can open a new ISA by transferring in an existing ISA then adding in this years £20k.

A second key aspect is to remember the maximum £85k in one organisation. The thing to check is financial institutions with more than one brand who collectively have the £85k limit. NS&I is the exception.

Yes, but the limit is a yearly limit. If you pay £20,000 into a Cash ISA that is just a normal interest paying and not a fixed term one then you can just keep adding to it each year. As long as you don't go over the yearly limit. You could have hundreds of thousands of pounds in one ISA provided you didn't exceed the yearly limit.
You can pay £20,000 in on the 5th of April and then another £20,000 in to the same ISA the following day as you would be using 2 different tax years.

Yes. We use our annual limit. We have an annual review to make sure it’s all done.

Yes I think so but you can only pay on 20k a year.
You can also transfer in ISAs which makes more sense if one of your ISAs attracts a higher rate of interest it makes sense to transfer all your ISAs into that one. I'm a bit confused about why you have several different ISAs unless one is stocks and shares and onenis a cash one

OP, you are probably best going onto somewhere like Money Saving Expert if you want proper advice. You are more likely to get people that actually know what they are talking about on there. This thread has more than one post where the very basics have been wrong.

This is incorrect. The rules have changed and now you can have as many ISAs as you want. You can only pay a max of £20k in total into those ISAs though