ISAs are a great way to save and invest. But, you might realise that your current provider isn’t offering the best benefits for you. You may want to transfer to a bank or investment platform that is better suited to your needs. If this is the case, then read on. This post will tell you everything you need to know about transferring ISAs.
Yes, you can transfer your ISA to another provider without losing your benefits. However, it is not as simple as doing a bank transfer.
You can only have one ‘active’ ISA (Cash ISA, Stocks and Shares ISA, Lifetime ISA or Innovative Finance ISA) in any tax year.
There are certain steps you have to follow to make sure you keep all the ISA benefits.
There are a number of reasons you might want to transfer your ISA from one provider to another.
For example, if you have a Cash ISA, you may want to move to a bank offering a better interest rate.
For Stocks and Shares ISAs, you may want to move to a provider with lower fees or a wider variety of investment options.
There are some steps you have to take to make sure you transfer your ISA properly without losing any benefits.
The first step is to decide which provider you want to transfer your ISA to. You can compare the rates and fees on offer to make sure you are getting the best deal for your unique circumstances.
Make sure you check the small print so that you are not faced with any nasty surprises or unexpected fees. The headline offers are not always as good as they seem. They may also only last for a set period of time, leaving you worse off in the long term.
Once you’ve chosen a new provider, find out if you’ll face any penalties from your current provider for moving.
Not all providers charge a fee for moving your money, but some will – particularly if you originally agreed to hold the account for a set length of time.
Make sure you account for these fees when making your decision about transferring your ISA. Extra fees may mean you’re better off sticking with your current ISA provider until the new tax year.
It’s very important that you do not try to make the transfer yourself. You must go through the official process of transferring your ISA; otherwise, you could lose all the benefits.
If you withdraw the money yourself and try to reinvest it, it will be subjected to the rules surrounding new deposits. Your savings and investments could lose their tax-free status as a result.
You will need to fill in an ISA transfer form for your new provider. For this, you’ll need the details of your old ISA to hand.
You should be able to do this either online or over the phone.
The length of time your transfer will take depends on the type of ISA you have and the type you are transferring to.
Transferring between Cash ISAs can take up to 15 days. Whereas a transfer from a Cash ISA to a Stocks and Shares ISA can take up to 30 days.
Meanwhile, transferring from one Stocks and Shares ISA to another can take up to three months.
This will depend on your current provider. There are no set fees for transferring an ISA, but certain banks may charge a fee.
You will be able to find out if your provider has any exit fees on its website. Details of these will also be included in the documentation you received when you first set up the ISA.
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