Get to grips with Isa

By THIS IS MONEY
Updated: 18:00 EST, 28 March 2001

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Anna Bowes, independent financial adviser at Chase de Vere, says: The basic rules are that each tax year (from 6 April to 5 April the following year) you can invest into either one maxi Isa or three mini Isas; you cannot open both a maxi and a mini Isa in the same tax year; and you cannot move money between different investment components in a maxi Isa. For example, money contributed to the cash component of a maxi Isa must remain in the cash component and cannot be switched to insurance or stocks and shares.

If I have £3,000 in one mini cash ISA can I start another with a different provider after 5 April? BF, Wirral.

Yes: 6 April is a new tax year so you have new Isa allowances.

I have a maxi Isa with Aberdeen Technology in which I have saved £100 a month for approximately nine months. Can I keep this going but also take out another maxi Isa of £100 a month for the next year? MF, Menai Bridge.

No: You can only invest into one Isa each tax year, so the £100 a month would need to be directed either into the Aberdeen Technology fund, or another of your choice. However, the capital that you have already invested with Aberdeen can remain invested until you decide to encash or transfer it.

I have a cash Isa at present. Another building society has one at a better rate. Can I 'freeze' my present Isa after the new tax year and open another one without closing the first? CR, Newbury.

Yes: You have new allowances with the new tax year. In addition, it may be possible to transfer your current cash Isa into the better rate account. A transfer will ensure that you are not utilising the new allowance, but retaining the original.

I opened an easy-saver cash Isa two weeks ago with Bradford & Bingley. I won't reach £3,000 by 5 April . Am I allowed to keep topping that one up after 6 April? PB, Blackpool.

Yes: But these contributions will use up your 200 1/2002 Isa allowance, rather than the current one. You cannot carry forward used allowances after the end of the tax year.