Individual Savings Accounts (ISAs) are a popular type of savings account for adults in the UK due to their tax benefits and the ability to save as cash or invest in stocks & shares. If you wish to open an ISA and already have one, you are allowed to transfer it to your new provider. We’ve selected 10 common questions that are asked around ISA transfers to answer in this article.
1. Can I transfer an ISA to another provider?
Yes, you can transfer your ISA to another provider. The provider you’re moving to will organise the transfer for you either as part of the application process or afterwards.
On Beanstalk, we have a simple ISA transfer form to complete. Once filled in we then take care of the rest of the transfer process, contacting your existing provider and arranging for it to be transferred across.
2. Can I transfer a cash ISA into a stocks & shares ISA or transfer stocks & shares ISA into a cash ISA?
Yes, you can transfer a cash ISA into a stocks & shares ISA and vice versa. If you would like to do this you’ll need to follow the transfer process of the ISA provider you wish to move to.
3. Can I transfer an ISA to another person?
No, you cannot transfer the ownership of your account to another person. If you want to give the money to someone else you would need to withdraw the funds from the account and give them the money this way. This is because the tax benefits you get from an ISA are for individuals, so can’t be transferred or shared.
The only time an ISA can be transferred to someone else is if the account holder has passed away but there are inheritance rules around this.
4. Can you do a partial ISA transfer?
Depending on your existing provider, you should be able to do a partial ISA transfer. As part of the transfer process you should be asked if the transfer is a partial transfer and if so how much you wish to move.
This is what happens when transferring to Beanstalk, we ask this question in our ISA transfer form.
5. How long does an ISA transfer take?
This can vary from provider to provider and will depend on things like the type of transfer and whether investments need to be sold first.
HMRC says that cash ISA transfers should take no longer than 15 working days and a stocks & shares ISA transfer should take no longer than 30 working days.
6. Is there a best time to transfer an ISA?
You can transfer an ISA at any time throughout the year and it will not affect your ISA allowance but there may be times in the year that would suit you better depending on your personal circumstances and the provider you wish to move to.
7. Can I transfer shares to an ISA?
You cannot transfer shares or funds that you already own to a stocks & shares ISA but depending on the ISA provider you’re with, you may be able to do what is called a Bed and ISA transaction. This is where you sell the shares you own and then repurchase them through your ISA.
If your shares or funds are in an existing ISA, then a few providers allow an “in specie” transfer where the actual shares or funds are transferred between ISAs as opposed to selling them first and transferring the cash across.
8. Does transferring an ISA use up my ISA allowance?
No, transferring an ISA doesn’t use up your ISA allowance. Your annual contribution allowance, currently £20,000, is the amount you’re allowed to pay into your ISAs in total in one tax year. A transfer of an existing ISA does not count towards this although any contributions made in that tax year prior to the transfer will count.
For example if you transferred an ISA worth £30,000 to a new provider and prior to the transfer had contributed £6,000 in the current tax year, the new ISA would start with £30,000 and you would have a contribution allowance of £14,000 left for the remainder of the tax year.
9. How many times can you transfer an ISA in a year?
You can transfer an ISA as many times as you wish in a year, there is not a limit.
10. Are there fees to transfer an ISA?
This will depend on your existing provider and their rules around transferring an account. Most new providers (including Beanstalk) will not charge anything for transferring an account in.