In this brief guide, we are going to be discussing the Nationwide ISA.

In this post, we are going to introduce you to the world of the Nationwide ISAs, their best use case and all you need to know about the specific ISAs.e.g which one can help you get on the property ladder or help you save for retirement.

What is the Nationwide ISA?

The  Nationwide ISA(Individual savings account) is a tax-effective way to save. ISAs allow you to pay no tax or the minimum tax on the interest you make on your savings.

To be eligible for an ISA you will usually have to be:

  • You must be at least 16 years old
  • You must be a UK resident
  • And you must have not subscribed to another UK ISA in the same category in the same tax year

So, you are probably wondering what does “subscribing to an ISA” mean. Subscribing to an ISA means paying into and opening an ISA. You are allowed to subscribe to one of each type of ISA every tax year and you must not exceed your ISA allowance each tax year.

How Many ISAs Can I have?💶🙌🏻

The current tax rules allow you to have or open one of each type of ISA every year but you can only put the maximum tax year ISA allowance in all of these ISAs. This means your combined savings in all your ISA accounts must not exceed your current tax year ISA allowance for the current year. The tax year ISA allowance is currently £20,000.

Can I open a cash ISA AND A LISA in the same year?

Yes, you can open a cash ISA and a LISA in the same year. You can also contribute to a cash ISA and LISA in the same year as long as you don’t go over your personal ISA allowance. You can out whatever you have left in other ISA accounts in the same tax year.

How many Nationwide ISAs can you open in one year?🔔❄

You can have multiple Nationwide ISAs but not more than one of the same( e.g you can’t have two Nationwide cash ISAs)   and your total Tax year ISA allowance must not be exceeded in your combined ISA contributions. This means ISAs you hold with Nationwide and ISAs you hold with other providers. Each ISA may also have its maximum contribution limit as well. So check the terms.

What to do if you open more than one type of Nationwide ISA?😮ℹ

Although it is very unlikely, if you mistakenly open more than one lifetime or stocks & shares ISA in a single tax year, you should notify your Nationwide ISA manager at the earliest opportunity. In some cases, the ISA may be allowed to remain open, once you have consulted with HM Revenue and Customs.

The rules for stocks and shares ISAs are the same as with cash ISAs. You can only pay into one each tax year but can open a new ISA with a different platform each year if you wish to. This means you may be able to further diversify by having one type of Nationwide ISA and opening the same type of ISA with a different provider in the next tax year. Contribution rules will still apply.

If you have multiple stocks and shares Isas open, you are only allowed to pay into one of them in each tax year. So, if you only wanted to invest a portion of your Isa allowance via the second Isa provider, this could be difficult as it will mean you are not able to add any new money to the original Isa in the same tax year.

The only other option to consider is transferring your existing portfolio to the other provider, although this might incur some costs.

Nationwide ISA

How do ISA transfers work?🌟✈

ISAs are tax-free saving wrappers and moving them to get a better deal is common. If you move your ISA in the wrong way you could just end up losing your tax-free status and costing you interest made from your ISA. If you want to move your ISA to a Nationwide ISA you should contact the Nationwide ISA manager.

Why should you transfer your ISA?🌈ℹ

You could transfer your ISA for a variety of reasons such as getting a better rate or because of reasons such as the cost of your current ISA manager or their performance.

You might also be transferring all your ISAs to a new manager to have all your savings in one place or rather move all your savings to different places in a scenario where your combined savings are over the financial services compensation scheme limit of £85,000 per account.

There are a variety of ISA providers out there and you can view their various offerings, including the way they invest, their past returns etc all online so you have an idea of which provider you want to move your money to.

To transfer an ISA you simply open a new ISA account(in this case a Nationwide ISA ) then fill an ISA transfer form and send to your old ISA manager. It’s that simple. Once the transfer is done you will get a closure statement showing exactly how much you have transferred.

Be sure to be on the lookout for any charges or transfer out fees imposed by your current ISA manager.

Nationwide ISA

How long does your ISA transfer take?👀

This depends on what ISAs you are transferring. If you are transferring a cash ISA then this should take 15 days. If you are transferring a stock and shares ISA then this will usually take 30 days.

If your ISA transfer takes too long you can report it to the Financial ombudsman.

Which ISAs can you transfer?❄⌛

You can transfer any ISA although there might be some penalty for ISAs which are fixed-term or notice ISAs. Some ISA providers do not accept ISA transfers.

If you have a notice ISA, it is probably best to give notice to your current ISA provider to avoid any charges.

If you choose to proceed without giving notice then you should compare how much interest the new ISA will earn you and the cost of the penalty. If you still make more money by transferring your ISA then, by all means, transfer your ISA if you wish.

The Nationwide ISA is covered by the financial services compensation scheme. This means you are covered by up to £85,000 per account in case anything goes wrong with your Nationwide ISA.

The majority of Nationwide ISA products are cash ISAs

Nationwide Cash ISAs

The Nationwide Cash ISAs are just like saving accounts which pay interest.The interest they pay is tax free and outside of your personal allowance. Cash ISAs will usually pay a fixed rate of interest or a variable rate. 

The personal savings allowance which gives you £1000 tax free depending on your tax band. This means basic-rate (20%) taxpayers will be able to earn £1,000 interest with no tax while higher-rate (40%) taxpayers – will be able to earn £500 interest with no tax. Additional rate (45%) taxpayers don’t get a tax-free allowance.

To open a Nationwide cash ISA you will have to be:

Over 18 years old

A Uk resident for tax purposes

Be a crown employee serving overseas

Or be married or in a civil partnership with a Crown employee

A Nationwide Cash ISA can be easily opened online, in app or via post. The maximum you can put in them is your personal tax allowance which currently stands at £20,000.

You can also transfer funds from an old ISA account into your Nationwide ISA account. 

To open the Nationwide cash ISA account you will need a minimum of £1 and you can then go on to contribute up to your maximum ISA allowance of £20,000 taking into consideration any other ISA contributions you may have made that tax year.

You can manage your Nationwide cash ISA account online by phone or via the Nationwide app.

You can make as many withdrawals from your Nationwide cash ISA account but you can only put back the amount left in regards to your maximum annual contribution.

You can cancel this account within 14 day of opening it.

Cash ISAs are usually considered a safe investment vehicle. They are covered by the financial services compensation scheme up to £85,000 per account.

Nationwide ISA

Types of Nationwide ISA

Nationwide Help to Buy: ISA

Nationwide Loyalty ISA

Nationwide Fixed Rate ISAs

Nationwide Flexclusive ISA

Nationwide Inheritance ISA

Nationwide Instant ISA Saver

Nationwide Help to Buy: ISA

The Nationwide Help to buy ISA is a type of Nationwide ISA which is only available to first-time buyers.

The interest rate on the Nationwide help to buy ISA is 2.50% AER/ 2.50% variable 

The interest on the Nationwide help to buy ISA is calculated daily and paid into the account on the 1st day of each month.

You can open this account online or in branch and give any instructions for the account online, by phone or by post.

What is the Nationwide Help to Buy ISA?

The Nationwide  help to buy ISA is a tax free wrapper where you can save up to £200 a month(max) and an additional maximum of £1200 a month in your first month. The Nationwide Help to Buy ISA comes with a maximum £3000 tax free Government bonus. If you use the money in your ISA to buy a home the government adds 25% of whatever is in your ISA to your mortgage deposit as a bonus with two exceptions.

  • You need at least £1600 saved to get the bonus
  • The maximum bonus you can get is £3000( so the maximum amount the government will pay you a bonus on is £12,000) although you can save more than this amount on the Nationwide help to buy ISA.

Quick facts about the Nationwide Help to Buy ISA:

  • To qualify for the help to buy ISA you need to be a UK resident and over the age of 16. The deadline for applying for a Help to Buy ISA is December 2019 and you must use it for a mortgage deposit by December 2030 if not you will not be eligible for a bonus. You can keep saving into your account until 30 November 2029.
  • You can only open the Help to Buy ISA per person and not as a couple etc The maximum property price you can purchase with the Help to buy ISA is £450,000 in London and £250,000 anywhere outside London.
  • You can only open one Help to buy ISA although you can transfer it to a different provider at any time.
  • Your maximum personal ISA allowance per year is £20,000
  • Your solicitor applies for you to get the Bonus for your mortgage deposit
  • You can withdraw your money at any time but of course the withdrawn amount will not count towards your bonus.
  • The bonus you are paid is calculated on the closing balance of your account and will be stated on your help to buy closing letter.
  • Any funds which you withdraw cannot be put back into the account. You can only pay your maximum monthly contribution of £200 into the account.
  • If the purchase of your property falls through you should get a failure notice which can be sent back to Nationwide so they can repatriate your funds into a newNationwide Help to Buy ISA

You can open the Nationwide help to buy ISA here. 

Nationwide Loyalty ISA

The Nationwide loyalty ISA is a type of Nationwide ISA which is for people who have held a Nationwide mortgage, savings or current account for more than a  year.

The interest rates on the Nationwide Loyalty ISA are as follows:

1.10% AER/tax-free (variable)

Variable interest rates linked to length of continuous membership.

1 year+ 0.80% AER/tax-free

5 years+ 0.85% AER/tax-free

10 years+ 0.95% AER/tax-free

15 years+ 1.10% AER/tax-free

“Interest is calculated daily and paid annually on 30 September and on the date the account is closed.

The interest rate is tiered and linked to the length of continuous membership with Nationwide. You will automatically move up the tiers from 1 year, to 5 years, to 10 years, up to a maximum of 15 years.

You can choose to have interest paid to you by having it added to your account, or by asking Nationwide to pay it into a different Nationwide current or savings account (as long as it is possible to make interest payments into that account) or a current account with another building society or bank.   “

The interest on the account is variable and can change at any time. Nationwide will let you know if and when it is changing.

To be eligible for the Nationwide loyalty ISA, Nationwide states that

“ aged 16 or over

have been a continuous member* of Nationwide for a minimum of 1 year

not have paid in more than the annual ISA allowance in total to a cash ISA, a stocks and shares ISA, an innovative finance ISA and a Lifetime ISA in this tax year

not have paid in to a cash ISA with another ISA manager in this tax year (unless you are transferring the money paid in to the other cash ISA to this one)

be resident in the UK for tax purposes or, if not so resident, either perform duties which, by virtue of Section 28 of Income Tax (Earnings & Pensions) Act 2003 (Crown employees serving overseas), are treated as being performed in the UK, or you must be married to, or in a civil partnership with, a person who performs such duties.   “

In regards to withdrawals in the Nationwide Loyalty ISA, Nationwide states “  withdraw up to £500 in cash a day or up to £500,000 by cheque at any of our branches

transfer money to another Nationwide current account or savings account (as long as it’s possible to make payments into that account), using our Internet Bank or Banking app – if you’re registered.

You can replace any withdrawn money from your cash ISA, as long as you withdraw and replace it in the same tax year, without impacting your annual ISA allowance.“

Nationwide Fixed Rate ISAs

The Nationwide fixed rate ISA is a type of Nationwide ISA which offers fixed rates as follows: 1.00% AER/tax-free (fixed)

Interest rates linked to length of fixed term.

1 year 0.75% AER/tax-free (fixed)

2 years 0.85% AER/tax-free (fixed)

3 years 1.00% AER/tax-free (fixed)

In regards to how interest is calculated Nationwide states “ Interest is calculated daily.

If you choose for interest to be paid annually:

Interest is paid at the end of the day before each anniversary of the account opening, at the end of the fixed term and on the date the account is closed. You can choose to have interest paid to you by having it added to your account, or by asking us to pay it into a different Nationwide current or savings account (as long as it is possible to make interest payments into that account) or a current account with another building society or bank.

If you choose for interest to be paid monthly:

Interest is paid at the end of each month, at the end of the fixed term and on the date the account is closed. The interest must be paid into a different Nationwide current or savings account (as long as it is possible to make interest payments into that account) or a current account with another building society or bank.

If you open your account towards the end of the month your first interest payment may not be paid until the following month. The final interest payment, when the account matures, is added to the Fixed Rate ISA. “

To be eligible for the Nationwide fixed rate ISA, you must

“  be aged 16 or over

not have paid in more than the annual ISA allowance in total to a cash ISA, a stocks and shares ISA, an innovative finance ISA and a Lifetime ISA in this tax year

not have paid in to a cash ISA with another ISA manager in this tax year (unless you are transferring the money paid in to the other cash ISA to this one)

be resident in the UK for tax purposes or, if not so resident, either perform duties which, by virtue of Section 28 of Income Tax (Earnings & Pensions) Act 2003 (Crown employees serving overseas), are treated as being performed in the UK, or you must be married to, or in a civil partnership with, a person who performs such duties.“

You can open the Nationwide fixed rate ISA account online and manage it by post, in branch, via the app or over the telephone.

You can close this account within 14 days of opening it with no penalty. You cannot do part withdrawals on this account. If you want to withdraw from this account you will need to withdraw all your funds. You will then be charged an early access charge based on the term of the Nationwide fixed rate ISA.

Nationwide Flexclusive ISA

The Nationwide flexclusive ISA is a type of Nationwide ISA for people who hold a nationwide current account. The account pays  a variable rate of interest based on your account balance.

£1 – £9,999- 0.70%

£10,000 – £49,999-0.80%

£50,000+-1.00%

“ Interest is calculated daily and paid annually on 30 September and on the date the account is closed.

You can choose to have interest paid to you by having it added to your account, or by asking us to pay it into a different Nationwide current or savings account (as long as it is possible to make interest payments into that account) or a current account with another building society or bank.  “

To open this account you must:

be aged 16 or over

not have paid in more than the annual ISA allowance in total to a cash ISA, a stocks and shares ISA, an innovative finance ISA and a Lifetime ISA in this tax year

not have paid in to a cash ISA with another ISA manager in this tax year (unless you are transferring the money paid in to the other cash ISA to this one)

be resident in the UK for tax purposes or, if not a resident, either perform duties which, by virtue of Section 28 of Income Tax (Earnings & Pensions) Act 2003 (Crown employees serving overseas), are treated as being performed in the UK, or you must be married to, or in a civil partnership with, a person who performs such duties

have your main current account with us. This means you must either:

hold a FlexOne, FlexStudent, FlexGraduate, FlexDirect or FlexPlus account, OR

hold a FlexAccount and:

have been paying in £750+ a month for the last 3 months (excluding transfers from any Nationwide account held by you or anyone else)

OR

completed an account switch to us (from a non-Nationwide account) using our Current Account Switch Team in the last 4 months.

You can open this account with a minimum of £1 up to a maximum of the annual ISA allowance (currently £20,000 for tax year 2019/2020). You can also transfer existing ISA funds into the account at any time.

In regards to withdrawals, Nationwide states “ Yes, this is an instant access savings account so you can get access to your money whenever you need it.

Subject to the account balance, you can:

withdraw up to £500 in cash a day or up to £500,000 by cheque at any of our branches

transfer money to another Nationwide current account or savings account (as long as it is possible to make payments into the account), using our Internet Bank or Banking app (if you’re registered)

make transfers by CHAPS (please note, this service is only available in branch and there is a fee payable).

You can replace any withdrawn money from your cash ISA, as long as you withdraw and replace it in the same tax year, without impacting your annual ISA allowance. “

The information provided on this page about the Nationwide ISA is accurate at the time of writing. You should check with the Nationwide ISA website as some of the information on this page may have changed.

If you have any questions or comments please let us know.

John Bate

John has 22 years of experience in financial services. This spans across financial research, financial services (As a qualified mortgage broker and underwriter), financial trading and sales at global investment banks. While working as a publishing research analyst, he covered European bank credit and advised institutional clients on investment strategies at both JP Morgan and Societe Generale. John has passed all three levels of the CFA (Chartered Financial Analyst) programme.