Halifax has issued an update as major changes to the limits that apply to its customers are coming in soon. The bank spoke out after a customer posed a question over social media.
The person asked Halifax: “How do I transfer in cash from another bank to a newly opened ISA?” The bank responded to explain the options that the customer had to do the transfer. Halifax said: “If you are registered for online banking, you can do this in the app or internet banking.” The group also provided a link to guidance on its website about how to carry out ISA transfers.
Account holders have the option to either make transfers from a stocks and share ISA or a cash ISA, into either a new Halifax cash ISA or into a new Investment ISA with the provider.
What ISAs does Halifax offer?
Halifax offers a range of cash ISAs, including flexible ISAs and a one-year and a two-year fixed account. The highest rate on offer is 4.2 per cent with the two-year account.
You can also choose from its stocks and shares ISAs, including accounts where you choose your own portfolio of investments or you can go for a ready-made spread of investments. Halifax also had a stocks and shares ISA for 18 to 25 year olds.
Major changes to ISAs
A major perk of ISAs is that any interest earnings or investment growth within these accounts is tax-free. Some important changes to the ISA rules are coming up.
From April 2027, the £20,000 ISA allowance will effectively be reduced, so you can only use up to £12,000 of the allowance for deposits into either cash or into stocks and shares accounts. The other £8,000 will still be there, but will only be available for deposits into stocks and shares accounts.
Savers over the age of 65 will be exempt from the changes and will retain the current £20,000 allowance. Another key change for savers from April 2027 is that the rate you pay on your taxable interest earnings is increasing.
The rate is moving up across all three tax bands by two percentage points. This will increase the rate for basic rate taxpayers from 20 per cent to 22 per cent.
Those on the higher rate will pay 42 per cent tax on their taxable interest earnings, up from 40 per cent, while those on the additional rate will see their rate move up from 45 per cent to 47 per cent.