Is anyone up for trying to lobby the UK government to change the ISA rules. I think we need to get 100k votes for it to be discussed.
We would need to write a sort of white paper first.
Personally in this day and age, only being able to invest new money into one of each type of ISA on an annual basis, and the guidelines for 6 weeks to transfer cash and 12 weeks for stocks between ISA providers is too restrictive.
It is not good for the consumer, nor does it help encourage competition either.
Say I want to invest my 20k allowance across Mutual funds, ETFs and stocks. I can’t do that here on 212 as no mutual funds. I also have to use a more expensive broker that covers all 3. 212 or other brokers lose out from that business and we incur higher fees.
Allow users to invest in multiple ISAs of any type in each tax year, up to the limit to help promote tax efficiency, competition and lower fees for consumers.
How could they work in practice?
The UK government already have a unique ID for each person in the U.K. - National Insurance Number.
I request a deposit with broker A of £2000. Broker A checks my NIN record and reserves £2k of my annual ISA allowance, and grants clearance to accept my funds. I deposit £2k and invest in stocks. Broker A tells my NIN record I have deposited £2k and my remaining allowance is £18k.
I then request to deposit £5k in a P2P ISA, £5k in a cash ISA, £5k in Broker A, and 5k in broker B. The first 3 are given clearance, and the last one is a partial clearance of £3k as that’s all I have left. I realise I forgot I had already invested 2k this year but still want to invest 5k in broker B. I only deposit 3k into my cash ISA, and cancel out the remaining £2k of clearance. I then request an extra £2k deposit in broker B and get clearance. I now invest 5k in my Cash IsA, 5k in broker A and 5k in Broker B.
I am now fully invested for the year.
Finally, I decide I hold too much cash. I withdraw 10k from my P2P ISA, and that temporarily adds an extra 10k to my current year deposit allowance. I then request to deposit £10k to broker A, get clearance and then deposit. Job done.
Just some examples, but it would allow greater flexibility to the user(all companies supporting this scheme would be able to provide a flexible ISA), along with help promote more competition hopefully as well.
- Is it a good idea?
- Would you change anything?
- Do you think we could get the 10k/100k votes needed?