How are ISA investment limits monitored/enforced? How are ISA investment limits monitored/enforced?
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    Default How are ISA investment limits monitored/enforced?

    Even a fairly astute person could easily make a simple screw-up if they split their annual ISA allowance between multiple products and hold several ISAs from previous years. Which suggests, since many people are not astute, cock-ups would happen all the time where investors forget they already maxed out their ISA at the start of the year, etc.

    How is the annual investment limit enforced when someone invests money between entirely separate companies? Does it rely on trust and competence or is there some mechanism in place?
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    Isn't it all fed back to HMRC when you take out a product? E.g a retrospective slap when they receive overlapping requests to use your yearly allowance.

    All linked to your national insurance number.

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    That's how


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    I imagine it's sent back to HMRC on paper where Betty enters it into a TRS 80. Apparently it's going well and she's already up to 2002.
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    Quote Originally Posted by d000hg View Post
    How are ISA investment limits monitored/enforced?

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    When you apply for an ISA you provide your NI Number. The provider then updates that with HMRC.

    It can take a while if you breach it, but the data is held centrally. It's part of being a provider that you have to update it.

    I recently had my entire 15k returned to me from Barclays in March when they noticed a breach & sent the whole back, back, taking off tax of what Id been paid.
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    So you quite easily could screw it up and it would get caught later on. That sounds confusing to resolve if it's not in simple cash products.. surely it must happen all the time, though less so now the allowance is so large.
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