Context. Short time-scale radio variations of compact extragalactic radio sources, known as IntraDay Variability (IDV), can be explained in at least some sources by a source-extrinsic effect, in which the variations are interpreted as scintillation of radio waves caused by the turbulent interstellar medium of the Milky Way. One of the most convincing observational arguments in favour of propagation-induced variability is the so-called “annual modulation” of the characteristic variability time-scale, which is due to the orbital motion of the Earth. So far there are only two sources known which show such a well-defined seasonal cycle, a few more sources with fewer data can be regarded as possible candidates for this effect. However, source-intrinsic effects, such as structural variations, can also cause the observed changes of the variability time-scale. Data for the new, recently discovered, and highly variable IDV source J 1128+5925 are presented. Aims. We study the frequency and time dependence of the IDV in this compact quasar. We measure the characteristic variability time-scale of the IDV throughout the year, and analyze whether the observed changes in the variability time-scale are consistent with annual modulation. Assuming a radio wave propagation effect as origin, we are able to constrain some physical properties (such as distance, scattering-strength, and possible anisotropy) of the “plasma” screen, which may cause the scintillation. Methods. We monitored the flux density variability of J 1128+5925 with dense time sampling between 2.7 and 10.45 GHz. We observed with the 100 m Effelsberg radio telescope of the Max-Planck-Institut fur Radioastronomie (MPIfR) at 2.70 GHz, 4.85 GHz, and 10.45 GHz, as well as with the 25 m Urumqi radio telescope (China) at 4.85 GHz. From ten observing sessions, each of which lasted several days during the period between 2004–2006, we determine the variability characteristics and time-scales which we investigate in view of possible scintillation and annual modulation. Results. The observed pronounced changes of the variability time-scale of J 1128+5925 are modelled with an anisotropic annual modulation model. The observed frequency dependence of the variation is in good agreement with the prediction from interstellar scintillation. Adopting a simple model for the annual modulation model and also using the frequency dependence of the IDV, we derive a lower limit to the distance the scattering screen and an upper limit for the scintillating source size. The latter is found to be consistent with the measured core size from Very Long Baseline Interferometry (VLBI).