These Terms and Conditions relate to the Cash Individual Savings Account (hereafter called ‘Cash ISA’) offered by North London Credit Union Limited. They should be read with the Membership Terms and Conditions and with the HM Revenue and Customs (HMRC) rules, which are subject to change at any time.
- Credit unions work by lending the money that members are saving with us. The interest that we charge on loans pays our running costs and the cost of making the loan available.
- Credit unions are owned by their members and any surplus made by the end of the year is distributed to savers. This includes those who have a Cash ISA.
- Individual Savings Accounts or ISAs, were introduced by the government to encourage people to save. There are various types of ISA, but North London Credit Union (NLCU) only offers a Cash ISA product.
- These guarantee the return of your original capital and (subject to our terms and conditions) any return on the amount invested is free of all United Kingdom tax.
- NLCU is not able to offer any general advice regarding ISAs or on the merits of the different types of ISA, nor can NLCU recommend any particular provider. We suggest seeking independent financial advice if required.
- The following are the basic features of an NLCU Cash ISA:
- Interest is free from Income Tax and Capital Gains Tax;
- Depending on your employer, payroll deduction facilities may be available if you are saving regularly;
- Like all deposits invested with us, your savings will be lent to local businesses and individuals to benefit the community;
- Your savings are completely safe, covered by the Financial Services Compensation Scheme (FSCS). See ‘Statutory Details’ for more information.
- The government fixes annual limits for investment of each type of ISA. Providing these limits are observed and capital gains and/or interest/dividend on the investment made is completely free of tax.
- The limit for the 2017/18 tax year is £20,000. This is also the maximum that we will hold for each individual member, although we will allow the limit to be exceeded by any dividends we pay you. The £5 that you are required to deposit in a Membership Account (see 20. below) is in addition to this limit, which does not affect any children’s accounts which you control.
- You cannot subscribe to more than one Cash ISA in any tax year, nor can you invest in more than one Share ISA in any tax year.
- You do not need to use all your overall allowance, nor do you need to use all of your Cash ISA allowance. By opening a Cash ISA, you may be limiting the amount of investment that can be made through other types of ISA. Please refer to HMRC guidelines.
- ISA tax allowances cannot be carried over into another tax year, but it is possible to reinvest funds previously invested in an ISA in another ISA of the same type (to benefit from a better interest rate, for example).
- If you choose to invest in different types of ISA, you may use different providers, however you cannot exceed the maximum deposit for each tax year, fixed by HMRC.
- NLCU cannot guarantee that favourable tax treatment given to ISAs will be maintained. The government is wholly responsible for setting out the policy on tax relief. The value of tax relief depends on individual circumstances. It is the account holder’s responsibility to ensure that they seek appropriate advice where necessary.
- Please note that one of our duties to HMRC as an authorised ISA provider is to provide them with an annual return detailing our Cash ISA account holders.
The ISA Account
- Your application is for a Cash ISA with NLCU. There are other types of ISAs available (not from NLCU), and there are other providers of Cash ISAs.
- Depending on financial performance during the credit union year (1st October to 30th September), NLCU hopes to pay a share of their profits to members, in the form of a dividend. Dividends can only be calculated and paid once they have been approved by members at NLCU’s Annual General Meeting, which takes place following the external audit of NLCU’s accounts.
- Dividends cannot be guaranteed. They are always subject to NLCU’s performance in the year and its subsequent ability to comply with all statutory requirements. This will be paid tax free, on all sums deposited, up to the deposit limit.
- Any dividend payable will be added to your Cash ISA account and the amount credited will be automatically reinvested in your ISA (subject to the deposit limit).
- It is not necessary to make regular additions to your ISA savings, however you may make additional deposits at any time to the ISA, either by transfer from any other NLCU account or by cheque, or by transfer, provided total sums of deposits do not exceed the maximum allowance of £20,000.
- Cheques made payable to NLCU accepted for investment in an ISA, but if they fail to clear the bank charges imposed on NLCU will be passed on to the account-holder.
- You can authorise another person to operate your Account. You will need to provide authorisation in writing. You can also do this by signing a power of attorney but you should take legal advice before doing so. If you authorise another person to operate your Account then you will be responsible for their actions or omissions as if they were your own.
- We are required to notify the investor if, by reason of any failure to satisfy the provisions of the ISA regulations, an ISA has, or will, become void.
Opening the Account
- The Cash ISA is open to new and current members of North London Credit Union aged 18 or over. If you are not yet a member, you may open a Cash ISA at the time of joining. Information on our membership criteria can be found on our website.
- Under NLCU Rules you must also hold a Membership Account with a minimum of £5 in it. The first £5 of your opening deposit will be used to fund this account if you do not already have such an account open.
- To be eligible to open a Cash ISA you must not have subscribed to another Cash ISA in the current tax year.
- To be eligible to open a Cash ISA you must be resident, and ordinarily 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 and Pensions) Act 2003 (Crown employees serving overseas), are treated as being performed in the UK, or married to, or in a civil partnership with, a person who performs such duties. You must inform North London Credit Union if you cease to be so resident or to perform such duties, or cease to be married to, or in a civil partnership with a person who performs such duties.
Withdrawals, Transfers and Account Closures
- Up to two withdrawals can be made on the ISA account per tax year without penalty, by way of bank transfer.
- All withdrawals (other than transfers to a registered ISA provider) will mean that the funds withdrawn lose their “tax free status”. For example, if you save £10,000 and then withdraw it, you would only be able to pay in a further £10,000 that tax year before you reach the limit.
- NLCU will, on request, transfer holdings to another ISA provider. To transfer all or part of your Cash ISA to another ISA manager you must give your transfer instructions to your new ISA manager, who will forward your request on to us.
- We will send the cash and relevant information to your new ISA manager as soon as possible within the time limit given, provided there is no reason for the transfer to be stopped (for example, to protect you from suspected fraud or other criminal activity).
- You can close your cash ISA at any time by giving us notification in writing. An account closure form is available from our website or we can send a copy on request. If you have subscribed to your Cash ISA during a tax year and then close the account, you will not be able to re-open the account or subscribe to another Cash ISA either with us or any other ISA manager in the same tax year.
- Your ISA ends on the date of your death. There will be no Income Tax or Capital Gains Tax to pay up to that date, but ISA investments will form part of your estate for Inheritance tax purposes. It may be possible for your spouse to inherit part of your tax-free allowance. Please see the HMRC guidance for more information.
- If you close or transfer your ISA prior to the declaration of any dividend, we will pay or transfer the capital as per 29. and 30. below.
- Any dividend then declared at the Annual General Meeting will be calculated for the time that the account was open and forwarded to you, as per the instructions given on the form completed at the time of account closure (it will be the responsibility of the member to inform us of any changes to these instructions or to contact details). We will not normally forward interest payments where the total payable is under £3.00.
- Statements for your NLCU accounts are issued annually, following the confirmation and application of any dividend. Additional statements can be requested at any time. There may be a small charge to cover the cost of additional postal statements.
- North London Credit Union reserve the right to close or suspend the Cash ISA or to add, change or remove any of these terms and conditions at any time. We will notify ISA account holders of these changes as soon as possible. You agree that we may do this either by personally by email (our preferred method, to reduce costs) or in writing, if you do not have an email account. 33. The terms and conditions of this product will continue to apply until you close the account, or we advise changes by writing, where reasonable notice will be provided, where possible.
- You must let us know of any changes to your contact details as soon as you can until final payment of any dividend has been paid.
- Savings in ISAs may not be used as security on any loan product.
- In certain circumstances we have the right to require up to 60 days’ notice for withdrawals from any of your accounts. This includes the Cash ISA. We will usually only require 60 days’ notice if we need to in order to protect the interests of all members of the credit union; in response to extreme market conditions; or if required to do so by the Prudential Regulation Authority (or any successor regulatory authority).
- A member of NLCU aged 18 years or over can receive a copy of the annual Report and Accounts (on request) and will invited to attend the Annual General Meeting as a voting member.
- If you wish to make a complaint about this account or North London Credit Union, you should address it to: The Complaints Officer, North London Credit Union, 3 George Mews, Enfield, Middlesex, EN2 6JA. Complaints can be made in person, by post, or by email. A copy of our Complaints Procedure can be sent on request.
- We are a member of the Financial Ombudsman Service and all deposits of members are covered by the Financial Services Compensation Scheme (see below).
- For more information about NLCU’s Cash ISAs or any of our other products, please visit our website (www.northlondoncreditunion.org), contact us on 020 8366 8244 or email firstname.lastname@example.org.
North London Credit Union Limited trades from its registered office at 3 George Mews, Enfield, Middlesex, EN2 6JA.
Its telephone number is 020 8366 8244, and its email address for general correspondence and enquiries is email@example.com.
North London Credit Union is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority, registration 213809.
North London Credit Union is approved by HM Revenue & Customs (HMRC) as a provider of Cash Individual Savings Accounts, under the reference Z1743.
North London Credit Union is covered by the Financial Services Compensation Scheme (FSCS). The FSCS will pay compensation to depositors if a credit union is unable to meet its financial obligations. Most depositors –including most individuals and small businesses – are covered by the scheme.
In respect of deposits, an eligible depositor is entitled to claim up to £85,000. For joint accounts, each account holder is treated as having a claim in respect of their share so, for a joint account held by two eligible depositors, the maximum amount that could be claimed would be £85,000 each (making a total of £170,000). The £85,000 limit relates to the combined amount in all the eligible depositor’s accounts with the credit union, including their share of any joint account, and not to each separate account.
For further information about the scheme (including the amounts covered and eligibility to claim), please refer to the FSCS through their website (www.fscs.org.uk) or call them on 0800 678 1100.