A customer contacted Nationwide as their ISA had just matured
Nationwide Building Society has clarified its rules around ISAs. The group explained its policies after a question from a customer about transferring their ISA.
They explained that their easy access ISA had just matured and they had set up another account of the same type with the provider. They asked: “Can I just use the transfer button to move the matured cash ISA to the new cash ISA, and still be within the tax bubble?”
ISAs come with the advantage that all interest earnings or investment growth in the account is tax-free. Savers can deposit up to £20,000 each tax year into ISAs with no tax to pay.
ISA savings can also be transferred to another provider and as long as you don’t withdraw any of the funds without affecting your yearly allowance.
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The customer went on to say that they had been told they could close their matured ISA and transfer over the funds to the new account, and that this would not affect their ISA allowance.
In response, Nationwide confirmed the rules.
The group said: “Transferring your matured ISA to an existing Nationwide cash ISA will keep your money’s tax-free status.”
The group also sent the person a link to some information on the group’s website about what to do when your ISA account is about to mature.
What ISA accounts does Nationwide Building Society offer?
Nationwide offers a one-year triple access ISA paying a variable rate of 3.75 per cent.
The rate drops to 1.25 per cent if a customer makes four or more withdrawals.
The group also offers several fixed rate ISA accounts. These include:
- One Year Fixed Rate Cash ISA – 3.8 per cent
- Two Year Fixed Rate Cash ISA – 3.8 per cent
- Three Year Fixed Rate Cash ISA – 3.8 per cent
- Five Year Fixed Rate Cash ISA – 3.8 per cent
Savers can close an ISA account before the term finishes, by visiting a Nationwide branch. However, a penalty must be paid to do so, equivalent to the amount of interest which would be earned over a certain period.
For example, someone with a one-year account would have to pay a penalty equivalent to 60 days’ interest.