I've paid into two cash ISAs within the same tax year. What should I do?

A question about : I've paid into two cash ISAs within the same tax year. What should I do?

I opened up a Mini Cash ISa with Barclays in March 2008 and paid in Ј100 lump sum. However I didn't realise that I had already paid Ј3000 inheritance in to another ISA in May 2007 - I thought I'd paid it in a lot earlier then that.

My questions is what are the penalties for having done this and what is the best thing to do now? I don't plan to pay any more in to the original ISa with the Ј3000 in it anyway.

Any help would be much appreciated. Thanks.

Best answers:

• You need to advise the bank - otherwise IR will be all over you...
  It would also mean that the potencially the Ј100 will lose it's tax free status. I'd also consult the IR personally as banks are not tax experts (as its already a complex field!)
• Suggest that you ring the HMRC ISA helpline - 0845 604 1701 (08:30 to 17:00 Monday to Thursday - 08:30 to 16:.30 Friday) and explain the mistake.
• HMRC Isa Helpsheet says:
  Duplication
  Remember you cannot invest in more than one cash ISA, or more than one stocks and shares ISA in the same tax year.
  Mistakes do happen. If you do invest in more than one ISA of the same type in a tax year, the second ISA will not be tax-advantaged.
  If this has happened call our ISA helpline. Have the details of your ISA accounts to hand when you call .
  So provided you tell them there are no penalties for a genuine mistake, your Ј3K ISA will retain its tax free status and only the interest on your Ј100 will be taxed. Not too much to worry about I wouldn't have thought.