In the current tax year, which runs from 6 April 2017 to 5 April 2018, you are allowed to save up to £20,000. This limit is commonly referred to as your ISA allowance and you are not able to exceed this.
You can pay into one Cash ISA, one Stocks & Shares ISA, one Innovative Finance ISA and one Lifetime ISA (maximum £4,000) in each tax year up to the current combined annual limit of £20,000.
Flexible ISAs allow you to withdraw and replace money from current and previous tax years without the replacement counting towards your annual ISA allowance. But not all ISAs are flexible so you will need to check before making a withdrawal if you are unsure.
Replacement money has to be paid into the ISA before close of business on the 5 April in the same tax year as the withdrawal. The ISA allowance is unchanged so you can only subscribe (pay in money that is not replacing a withdrawal) in the current tax year up to your ISA allowance. The amount that will count towards your annual ISA allowance is the net balance of money paid in less money taken out.
Once a new tax year begins, you can then add to your savings using the new tax-year allowance subject to the terms and conditions of your account.
If you don’t save £20,000 in a tax year, you won’t be able to carry forward any unused allowance into the next tax year, so if you can, it makes perfect sense to use up your full allowance every tax year to maximise the benefits of your ISA.
ISA accounts are subject to an annual allowance limit. This section explains these details.
What is a Cash ISA?
A Cash Individual Savings Account (ISA) is simply a savings account. You do not pay tax on interest from an ISA. Every tax year you can save up to your annual ISA allowance limit of £20,000. The tax year runs from 6 April to 5 April the following year. We have a range of options to help you take full advantage of your annual ISA allowance.
ISA allowance limits
With an ISA you can save money as cash (in a Cash ISA), invest in the stock market (in a Stocks & Shares ISA), lend your money to other individuals or companies as a loan (in an Innovative Finance ISA), save towards your first home and/or retirement (in a Lifetime ISA) or a combination of all four. This is based on UK taxation law and HM Revenue and Customs practice which may change.
On the 6 April 2016, ‘ISA flexibility’ came into effect. All flexible ISAs allow you to withdraw money from your ISA and replace withdrawn funds within the same tax year without affecting your current year ISA limit of £20,000.
Some ISAs do not offer this flexibility, however you may still be able to make withdrawals. And if you replace withdrawn funds at a later date, this will use up more of your annual ISA allowance.
As with any savings account, Cash ISAs vary in terms of the interest rate they pay as well as how flexible they are. That’s why it’s really important to make sure you choose the account that suits your specific needs and financial circumstances. Take a look at the following Cash ISAs to see which one is right for you.
Some Cash ISAs will allow you to withdraw your money whenever you need to and without a charge applying. This means you can be as flexible as you need to be.
This type of Cash ISA is right for you if:
- You know you will need to access your money fairly quickly.
- You are unsure when you may need your money – it’s better to go for flexibility over a higher interest rate if you are in doubt.
There are also fixed-term accounts where you can withdraw your money during the fixed-rate period subject to a charge equivalent to a loss of interest. These accounts can range from one year up to five years, and usually pay a higher interest rate as the fixed term increases.
This type of Cash ISA is right for you if:
- You are happy to tie up part of your savings for a certain period of time.
- You would like to earn more interest.
Yes, if you choose an Easy Access Cash ISA, you can withdraw money at anytime. If you withdraw from a Fixed Rate Cash ISA, there is a small charge.
For example, if your rate is fixed for one year, the charge will be the equivalent of 60 days’ interest. If it’s fixed for three years, the charge is 120 days’ interest and for five years it’s 180 days’ interest.
Yes, you can transfer a Cash ISA from another provider to Virgin Money, or from one Virgin Money Cash ISA to another. This excludes Additional Permitted Subscription ISAs which do not allow ISA transfers in.
Virgin Money accepts transfers from other banks and building societies providing that any money deposited in the current tax year is transferred in full. We will make this as simple as possible for you, all you need to do is complete and submit your application form along with an ISA Transfer Authority Form and we’ll do the rest.
If you want to transfer money from one Virgin Money Cash ISA to another, simply visit your local Store, call us on 0345 600 4466, or sign in to Online Service and send us a secure message using the Messages facility. These transfers will be processed at our Main Office within five business days.
If you do not pay in to your Virgin Money Cash ISA for a full tax year, then this is known as a 'break in subscriptions'. And if you would like to continue to add more money to your Cash ISA, then you will need to sign the ISA Declaration again so that you refresh your knowledge of the ISA rules before we can accept any further payments into the ISA.
This also means we meet HMRC rules that state we need you to re-confirm key information such as your name, date of birth and National Insurance Number.
If you do wish to deposit more money into your Cash ISA and you did not pay in during the last tax year, then there are two options available to you:
- For online Cash ISAs - simply sign in to your account and follow the on screen instructions.
- For offline Cash ISAs e.g. Store or postal accounts - download and print your break in subscriptions Cash ISA Application form returning it to:
Newcastle upon Tyne