ISAs: how to transfer Cash, Stocks & Shares, Lifetime ISAs and more

If you already have an ISA but have found a better deal, make sure you transfer it instead of closing it.

If you're looking to transfer to a better ISA, the rules generally vary depending on what you’re switching and where you’re going. However, there are five golden rules that apply to everything.

The golden rules

Transferring is easier than ever. There used to be restrictions on the kinds of switches you were able to make, but since 2014 you have been free to switch between different kinds of ISAs – and back again – at any time.
Whenever you transfer any kind of ISA, you mustn’t close it. If you do, the money comes out of the ISA wrapper, and you’ll lose those years’ ISA allowances forever. Instead, you need to contact the company you are thinking of moving to, and get them to arrange the move for you – so the money stays within the ISA regime.
As a general rule, transferring an old ISA from a previous tax year won’t have any impact at all on your allowance for this year. It means you can switch an old ISA, and still contribute up to your annual limit this year too. You can also move an ISA from this tax year – but that will come out of this year’s allowance.
You’ll need to check whether the ISA provider you want to switch to accepts money from other ISAs. Not all of them will, and some will only accept partial transfers, so check before you get stuck in.
Before you move, you’ll also need to check whether there is a charge from your old provider for leaving (or a loss of interest on Cash ISAs). You are more likely to see charges on older ISAs, or on specific kinds – like fixed-term Cash ISAs of Lifetime ISAs.

Transferring Cash ISAs between providers

If the interest rate paid on old Cash ISAs has fallen, you can shift your money – and it should all be done within 15 days.

Before you do so, check if you will lose interest or face a charge for leaving, and calculate whether it’s worth paying the fee in order to be free to switch to a better rate.

Transferring Stocks and Shares ISAs between providers

If you have invested through an investment platform, switching between funds is straightforward, because you can sell and buy shares and funds at any time within the ISA wrapper without worrying about tax.

If you have invested direct with a fund manager, there are two ways to switch.

You can do a ‘cash transfer’, so your old provider sells your investments, and passes the money to your new provider, to be invested as you wish.

The guideline is that this should take no more than 30 days and during that time you will not be invested.

This could work for or against you, depending on how markets move while the transfer takes place.

Alternatively, if you are shifting between providers, but want to stay in the same funds, you can do what’s known as an ‘in specie’ transfer.

This means you stay invested throughout the process; your investments are just handed over.

This has the advantage that you’re not out of the market at all, but do check for any charges your old provider may impose because sometimes moving ‘in specie’ costs more.

Transferring Junior ISAs between providers

Despite the fact that you cannot withdraw money from a Junior ISA until the child reaches the age of 18, you can still switch Junior ISAs in exactly the same way as their adult equivalents.

Transferring between Lifetime ISAs

The process is the same as switching between basic ISAs and should take no longer than 30 days.

Transferring from a Lifetime ISA to a Cash ISA or Stocks and Shares ISAs

This is possible, and works in the same way as transferring basic ISAs.

However, when you transfer out of a Lifetime ISA and into another type before the age of 60, while you will keep the money in a tax-free environment, you will pay the 25% withdrawal fee.

Transferring a deceased spouse's ISA

On death, the cash or investments will come out of the tax-efficient wrapper and go into the overall estate, to be divided according to whatever is laid out in the will. It may also be subject to Inheritance Tax.

What passes to the surviving spouse isn’t the ISA itself, but an additional ISA allowance – equal to whatever their spouse held in ISAs at the time of their death. It’s known as an Additional Permitted Subscription allowance – or APS.

This is held with the deceased spouse’s ISA provider.

However, you don’t have to use the same provider – you can move it elsewhere. Just check with your preferred ISA provider whether they accept APS transfers, then sign up and get them to arrange the move.

The investment or saving can be made in cash – either as a lump sum or (if the provider allows it) through monthly contributions. There’s usually a three-year limit on using your allowance.

Alternatively, if the surviving spouse inherited ISA investments, they can make an ‘in specie’ transfer of the same investments into a Stocks and Shares ISA with the same provider.