How do Bank's know whether the amount you transfer over from an ISA is from the current tax year or a previous tax year?

[mothersdayhmm]

I've opened a new ISA with Barclay's, and I'm transferring in the balance from my Nat West ISA. The funds in my Nat West ISA are from last year (I haven't made any deposits since 6/4/25), but how do Barclay's know this to be true? Do they know, or do they just trust people to be honest?

They know because the financial institution which is transferring the funds from have to notify them. What you can’t do is close the first ISA yourself, put the funds into your regular bank account, then pay them into a new ISA in the same tax year unless it’s under £20K.

This is interesting thanks! So, if I had paid say £1000 in after 6th April, then Nat West would tell Barclays that £x was from old tax years, and £1000 was from this years allowance?

When you open the new ISA, you give them the details of the old one and they do the transfer.

Yes, this is what I have done. But how do Barclays know that I didn't just deposit £20k into my Nat West Isa yesterday (for eg)? I didn't, but how do they know?

Because the ceding scheme will tell the receiving scheme that the deposits were made in the previous tax year.

Each institution is responsible for recording the split of funds between current/previous years, and then providing that information to the new provider when an ISA is transferred

With all things regarding tax the onus is on you to make sure you are paying the correct tax anyway so even if no one was told it's for you to check it's correct and you haven't evaded paying tax

any new money that you put in an ISA counts as the tax year on the day you put it in

any money you transfer from one ISA to another counts as the tax year when it was first invested

all ISAs are linked to your NI number so they all link up at HMRC. If you try to put >£20k in as a new payment in any one tax year it'll eventually bounce back to you.

If you'd already paid into one cash ISA this year you wouldn't have been allowed to open the Barclays one. They carry out checks (and you make a declaration when opening a new ISA that you haven't already paid into another cash ISA this tax year).

You can open more than one ISA in a tax year as long as you don't pay in more than £20k across all the ISAs.

Oh yes you're quite right, they changed the rules recently didn't they. Apologies. Anyhow, they still run checks and you still need to make a declaration when you open the account.