Help with understanding Santander two year ISA

[meisafairy]

Hi, I’m hoping someone can help me as we’re getting nowhere with Santander.
My oldest daughter who is 31 opened a two year ISA with Santander last August she put in 12,000 over three transactions hoping to get it up to the 20,000 limit but it didn’t allow any further deposits after her third deposit in September which totalled 12,000.
how can she deposit the remaining allowance of 8000 into that ISA? It should’ve reopened today?
As it’s a two year ISA is it locked until next year or is it due to bank holiday that she can’t deposit the last 8000 till tomorrow?
Or worst case scenario will she need to get a one-year ISA to run alongside the two year one and just deposit the 8000 into that?
Thank you for any help or guidance as we are getting nowhere with Santander’s call Centre.

It depends on the terms and conditions of the actual ISA. They are all different!

She has lost the isa allowance for 2025/6, as we are now into a new tax year. If she can deposit the money now and is happy to do so, she can. Only santander can confirm why she couldn't put the remainder in. If she can't get answers by phone she can complain.

She has tried this morning sitting next to me and it won’t allow it to go through. We just can’t fathom what the issue is. And we’ve got no sense from Santander call Centre when we tried them twice towards the end of last September.

I have an isa with Santander and have had other providers. Often there is a 'deposit window' and after this you can't add to it any more. I've got a fixed term isa and I don't think it means you can add in year 2, it just means the term for that product is2 years. As pp said the 25/6 tax year is over now so your dd will have lost whatever allowance for that year she didn't use. She can open a new product today for the new tax year.

As PP has said, she can't use the remaining £8k allowance now, it's lost - she has a new £20k allowance now until next April.

She needs to contact Santander to find out the problem, none of us can help. If they don't help, she can ask to speak to a manager / someone else - and if that doesn't help, make a complaint. They will have a complaints team who will unpick and explain, and might - or might not - offer a goodwill gesture to compensate for loss of tax allowance. But really she should have sorted this out before end of tax year.

Thank you that makes sense, So she should be able to open another ISA alongside this one for a year and use the 8000 that she has saved.
The remaining 8000 has been in a Savings account with Santander.

Santander fixed rate isa’s only allow extra deposits within the first 30 days of opening the account…then nothing more until the fixed rate ends.
Fir this year she needs to open another isa with a different bank..Santander only allow one isa to be opened during the fixed term.
Im pretty sure this is the case… having just renewed my fixed rate isa with Santander last week!

Not with Santander she can’t!

If it's a fixed term saver then the rules are quite explicit: "No additional deposits, withdrawals or account closures permitted."

Yes, she has 20k allowance for this year, so could open an additional one if she wants to. She could also have done this last tax year, the main issue is that you don't go over your £20k total allowance per year (for cash isas). Next year the cash isa limit is changing, but there is still the same 20k allowance this year.

Although as some posters are saying perhaps not with Santander. There are lots of isa providers so just choose one who had the best terms for your daughter.

Thank you so much for your help. You’ve been really informative and she will look for an ISA at elsewhere now. Can I ask? Ask a really really stupid question as I’m really naive to all of this and my daughter is looking over all your comments, is it just 8000? She can put in this year or can she go up to 20,000 thousand even though she has a two year ISA that still has a year to run with Santander.thank you again

She can put in £20000 this tax year.

It sounds as though that particular ISA is a fixed term one that only allows a set number of transactions during its term (two years)
Why can't she open another ISA . If she opens a new one she will be able to put on up to 20k.
The allowance is 20k a year but individual accounts have different terms and conditions

You have 20k allowance every year, and this 'refreshes' at the start of the new task year, so she has a new £20k allowance now for the rest of this tax year. If she only has 8k to deposit now she can take one for this amount, and if she has money later in the year she can add another one. Deposit the money she has now asap so she earns interest from now.

Most isas I've had have a fixed deposit window, so you can't add into them later on.

there are some things to be careful of with multiple isa accounts - if your daughter ever wants to transfer from one isa into to another she must not withdraw the money to a normal account, she must follow the 'transfer in' process. If the money goes into a non-isa account at any stage on the process she looses the 'tax free wrapper', meaning the money & subsequent interest is liable for tax if it comes into a normal account. Of course if she wants to spend it that's fine!

I have a flexible ISA which is great because you can deposit and withdraw as many times as you want. It probably doesn't pay as much interest as some other ISAa but isn't bad and it gives complete flexibility

I have a Moneybox cash isa and I can add as and when I like. Also a couple of penalty free withdrawals every year.

Thank you I think flexible ISA might be the way to go for her she thinks as she is saving 1000 a month at the moment to get on the property ladder and where we live you can get a nice house a starter house for £120,000, she has 12,000 in the two year fixed straight ISA with Santander she has 10,000 in her Santander savings account and she has 10,000 in premium bonds. She wants to buy a house outright rather than have a mortgage.

She should look at putting £4000 of this years allowance into a Lifetime ISA if she is using the cash to buy a house. The gov will then add another £1000. You can only use it to buy a house or for retirement and I think it needs to be open for 12 months before you use it. The rules may change but at the moment you can add £4k every tax year and get the £1k free money every year. There are penalties if you take it out for any other reason. So look into it carefully.

i wouldn’t keep £10k in premium bonds. She could put £20k from savings and PB into flexible ISA/LISA now and then put her monthly savings in a standard taxable savings account. Tax payable on this will depend on her other income but may well be under the limit for any tax at all.

I’m able to give her half of what she needs towards the house next year when I downsize so she doesn’t want to tie up too much if that makes sense.

The LISA only allows you to pay in £4k a year, so that's definitely not going to tie up 'too much'. By not using that allowance she's losing out on the 25% top up.

After filling a LISA she would still have £16k left of the normal ISA allowance.

www.moneysavingexpert.com/savings/best-cash-isa/#needtoknows

Part of my ignorance does a Lisa restrict you to what you can buy as she just wants a two bed older house, But she doesn’t want to be behold to any government rules of what she buys and where she buys and have to pay anything back if that makes sense she just doesn’t want be owing anyone anything. Again, you’re collective advice has been really appreciated.

To use the LISA for a house purchase it needs to be the first house you buy, you need to be taking out a mortgage, and the house price must be under £450,000.

https://www.gov.uk/lifetime-isa/withdrawing-money-from-your-lifetime-isa

If she puts in £4k this year and the same next, the government top up would be enough to pay for her survey and conveyancing fees, with a bit left over for mortgage arrangement fees as well.