Cash Isas

[Dudley]

I have always understood that you can purchase a share ISA (or similar) each year up to the maximum allowed (currently £10,680) and build up a portfolio over time with the interest paid tax free but until recently I had never bought a cash ISA. According to a Santander cash ISA which my wife holds, the annual summary states that if you continue with the same cash ISA for a second year you are unable to purchase another in that same year and therefore not be able to build up a similar portfolio which would mean there are different rules for cash ISAs as opposed to share ISAs etc. Can anyone clarify please?

[factor-fiction]

I'm not sure what your query is. If she continued with the same cash ISA for another year she could:
- contribute up to the annual limit to that,
-or she could transfer it to another provider,
-or she could leave the current one untouched (other than gaining interest) and open another one next year and contribute to the new one only.

You can only contribute to one cash ISA in any one year so she couldn't contribute to both in the same year

[Dudley]

Thanks factor 30 but I am still not sure. Are you saying that you can purchase a cash ISA each year whilst retaining your existing ones. In other words given the foregoing, are you able to build a portfolio of cash ISAs if you only invest money in one of them in any one year.

[factor-fiction]

Yes- some people have numerous cash ISAs, but all but one will just be gaining interest and they'll be contributing to one or none.
Look on the Martin Lewis site at the ISA guide.

[ubasses]

Using the 2010 limit you can put £5100 into a cash ISA after the 6 April you can put another £5100 (or the new limit) into a cash ISA with the same Bank/building society or
a different one if rates are better. If you chose a new one you can transfer the previous years over but this must be done by the bank , you cannot take the money out and take it to a new Bank or you will lose the tax free status. The remainder of each years allowance can be placed in a stocks and shares ISA each year and this will hopefully grow along with the stockmarket and the dividends that will be income into the fund. To do this you would need to ensure that you open mini ISAs Alternatively you can invest the full amount into a stocks and shares ISA. and this woulod be a maxi ISA. Although the £5100 is the most you can put in cash you can save a lesser amount and put a bigger amount to the stocks and shares ie £300 in cash & £7200 in stocks.