Transfer an ISA if you're an ISA manager

Transferring an ISA

Investors have the right to transfer their Individual Savings Account (ISA) whenever they want. This right must be included in yourthe manager’s ISA terms and conditions.

They do this by making a transfer application to the new manager. They cannot transfer an ISA by closing it and paying the proceeds into a new ISA with the new ISA manager.

If theWhere ISAthis isoccurs in respect of a Lifetimelifetime ISA:

• not only will the tax-free wrapper will be removed
• theremoved, transferit will also be treated as a withdrawal,withdrawal soand may be liable to a withdrawal charge

charge.

Transfer rights forin relation to non-cash Innovativeinnovative Financefinance ISA investments are available only as set out in the terms and conditions of the account. There are no restrictions when transferring on funds held in cashcash, and stocks and shares ISAs being transferred to Innovativeinnovative Financefinance ISAs.

A transfer application can be made by someone holding a mandate from the investor.

TheAllowable following transfers are allowed:transfers:

• subscriptions can be transferred freely between cash, stock and shares, and innovative finance ISAs

• subscriptions to a lifetime ISA canmay be transferred to cash, stocks and shares and innovative finance ISAs, but will be treated as a withdrawal and may be liable to a withdrawal charge

• subscriptions to a Lifetimelifetime ISA canmay be transferred tobetween anotherlifetime Lifetime ISAISAs without incurring a withdrawal charge

• funds held in cash ISAs, stocks and shares ISAs, and cash held in Innovativeinnovative Financefinance ISAs may be transferred to lifetime ISAs, —with the caveat that the amount transferred must not result exceedin exceeding the annual Lifetimelifetime ISA subscription limit

Transfer process

ISA managers are not obliged to accept transfers in.

The terms of a transfer should be agreed between:

• between the investor
• you, asand the old both ISA manager
• the new ISA manager

 managers.

WhenWhere an ISA is transferred,transferred all the tax benefits are preserved.

Subject to the ISA terms and conditions of both ISA managers, youthe old manager may transfer:

• the ISA investments, in which case the new manager must re-register the investments in accordance with their terms and conditions —(refer readto ‘ISA terms and conditions’ in our guidance on what you need from investors when they apply for an ISA )
• cash
• any combination of these

Investments and cash transferred are not new subscriptions for the purposes of the overall subscription limit. If transferred into a Lifetime lifetime ISA, they may be eligible for a government bonus and may contribute towards the Lifetime lifetime ISA threshold.

Read lifetimeFor ISAstreatment forof ISAthe managerstransferred toamount findin outrespect howof the transferredgovernment amountbonus willrefer beto treatedthe forguidance thelifetime governmentISAs bonus.for ISA managers.

YouISA managers must transfer the investments and cash direct to the new ISA manager. managers. If youtransferred transfer them to the investor, this will be treated as a withdrawal,withdrawal so the investments and cash will lose theirits tax-free wrapper.wrapper Ifand theyfor have been transferred out of a Lifetime lifetime ISA, there may also be liable to a withdrawal charge.

Find out more on how to manage ISA subscriptions for your investors.

YouISA managers must keep a record of ISAs you they transfer out, including either:

• the original or certified copy of the applications,applications ifor in the applicationcase wasof madeapplications not in writing
• writing, the declaration you made by the manager for 3 years after the date of transfer,transfer. if the application was not made in writing

Find out more about what you need from investors when they apply for an ISA.

What amounts can be transferred

An Investor must either do one or both of the following:

• transfer some or all of the current year’s ISA subscriptions, the investments bought with those subscriptions, and any income arising on those investments
• transfer some or all of the previous years’ ISA subscriptions, the investments bought with those subscriptions, and any income arising on those investments

Where current year subscriptions are transferred, the total amount must be transferred (including any related income) and are treated for all ISA purposes as if they had been made to the receiving ISA manager.

Specific ISA types

Lifetime Innovative finance ISA

WhenA subscriptionstransfer fromof the currentcash oris previousnot possible unless all the current year subscriptions are transferredtransferred, therefore by liquidating the peer-to-peer loans and crowdfunding debentures or transferring ‘in specie’(this means to anothertransfer Lifetimeownership of an asset in its current form, without needing to convert the asset to cash).

Lifetime ISA,

Transfers of current year’s subscriptions to another lifetime ISA means the government bonus must also be transferred. This also applies to previous year subscriptions.

Non-lifetime ISAs to lifetime ISAs

Only current year subscriptions,subscriptions and(including any related income,income) canwhich bedo transferrednot fromresult ain non-Lifetimethe lifetime ISA limit to abe Lifetimeexceeded ISA.can Transfersbe must not exceed the Lifetime ISA limit.transferred.

FindFurther outinformation moreon about reporting transfers is available in annual returns of information.

TheIn valuecash ofand investment ISAs, if the investmentsinvestor musthas berequested treatedthat asthe beingcurrent anywhereyear betweensubscriptions 2be limitstransferred, ifbut both:

• theythe areamounts currentcannot yearbe subscriptionsidentified, init amay be regarded as cash orand investmentinvestments ISA
• theirwhose total value is unknown

anywhere between 2 limits.

The 2 limits are the total amount subscribed in the current year:

• plus a reasonable apportionment of theany income fromarising on that subscription (upper limit)
• less withdrawals made in the year (lower limit)limit), — if the withdrawals exceed subscriptions,subscriptions the lower limit is £0£nil

AllIf the total value of the cash and other investments held in the ISA are treatedless asthan currentthe yearlower subscriptionslimit, ifthen theirall totalthe valuecash isand lessinvestments thancount theas lowercurrent limit.year.

Where an investor wants to transfer all or part of the previous year’s subscriptions, the manager should calculate the lower limit, and subtract that from the total value of the cash and investments in the ISA. Some or all the remainder can be transferred as a previous year’s subscriptions.

If the total value of the cash and other investments held in the the ISA is is less than the lower limit, all investments and cash held must be treated as a current year subscriptions and there are no previous years subscriptions to transfer.

Transfer applications

InvestorsUnless mustthe makeISA ais transferbeing applicationtransferred tointo thean newexisting ISA managerwith unless the new ISA ismanager, beinginvestors transferredmust intomake ana existingtransfer application to the new ISA theymanager holdwhen withrequesting thea new manager.transfer.

This can be achieved by asking the investor to complete:

• a transfer authority form (which is not a requirement of the ISA regulations), which the new ISA manager forwards to youthe old ISA manager and authorises youthem to transfer the ISA (or part of it) to themthe new ISA manager
• an ISA application form or a transfer instruction

A transfer instruction should include the appropriate authorisation to hold the ISA investments and agreement to the manager’s ISA terms and conditions —(refer readto the ‘ISA terms terms and conditionsconditions’ in our guidance on what you need from investors when they apply for an ISA.). ItHowever, doesit is not needrequired to include the investor’s date of birth, National Insurance number, or any of the ISA declarations. This can be completed by someone holding a mandate for the ISA investor. Find out more about how to open an ISA as an ISA manager.

ToThe starttransfer theis transfer,initiated theby investoran will approach to the new ISA manager.

If the new manager already holds an ISA for the investor into which the transfer will be made, a person holding a mandate to operate the account can request that the funds are moved into that account (as an application to open the account is not required). Subscriptions can be made following the transfer if the manager holds an application form that is still valid.

AnIf applicationthe madetransfer byrequires thea investor,new oraccount someoneto holdingbe aopened mandateand forthe them,investor willwishes beto neededsubscribe if:

• ato newthe accountaccount, needsan toapplication bemade opened
• by the investor wantsor tosomeone subscribeholding toa themandate newfor account

the ISA investor will be needed.

If the investor is transferring ISA savings and does not wantwish to make any further subscriptions to the new account, the transfer can be processed by a person holding a mandate to operate the account. However, the new ISA manager cannot accept subscriptions without a new application.

The ISA application form or transfer instruction can be made by the application not in writing process. However, youit canis possible that the old ISA manager will require the transfer authority form to be signed by the investor before youthey will agree to release the funds. TheThis is something for managers to resolve, the ISA regulations do not override the requirement for a signature if one is required by yourthe old manager’s terms and conditions.

Find out more about what you need from investors when they apply for an ISA.

Internal Transfers

A transfer application is not required where an existing ISA investment is switched from one product to another (which is what happens on the maturity and ‘roll-over’ of a fixed-term product). The existing ISA continues (with either the same or a new account number). However, an ISA application form must be obtained where all the following apply:

• the investor is eligible to subscribe to the ISA after the transfer (the residence condition is satisfied)
• the investor intends to subscribe to the ISA after the transfer
• the existing application form is no longer valid

Where one type of ISA is transferred to another type, a transfer application is required. For example, where a stocks and shares ISA is transferred to a cash ISA, and the investor intends to subscribe following the transfer.

Find out more about what you need from investors when they apply for an ISA.

Cash ISA transfers

Cash ISA to cash ISA transfers must take place within 15 business days of the transfer instruction being received by the new ISA manager, unless the investor stipulates that the 15 days starts on a later date. The 15 days are broken down as follows:

The new ISA manager has 5 business days to forward the instruction to you.the old ISA manager.

YouThe haveold ISA manager has 5 business days in which to send the funds and information to be provided to the new ISA manager.

The new ISA manager has 3 business days to apply the funds to the new ISA.

The other 2 days are to allow for time taken for first class post between you and the new manager.managers.

This timetable does not apply to transfers for:

• cash ISA to stocks and shares, innovative finance or lifetime ISA
• stocks and shares, innovative finance or lifetime ISA to cash ISA

YouManagers should complete such transfers in accordance with yourtheir ISA terms and conditions —(refer readto ‘ISA terms and conditions’ in our guidance on what you need from investors when they apply for an ISA.

). If the previous ISA is a notice account or a fixed-term product, the investor may incur an exit penalty or interest penalty if the funds and transfer history form are sent to the new manager within the stipulated 5 business days.

To avoid athe penalty,investor youbeing canpenalised, the old manager could contact the investor and receive a revised instruction to transfer the the ISA after after:

• the notice period has expired
• expired, or the product has reached maturity

maturity. This will be treatedregarded as a new transfer instruction that initiates a fresh timetable.

Information to providebe provided to the new ISA manager

YouThe old ISA manager must give the new ISA manager a notice in writing containing information about the ISA being transferred,transferred using a transfer history form.

The information can be given electronically and doesneed not needhave a ‘wet’ signature.

Where the transfer is a bulk transfer, the information must be provided at the time of the transfer. IfIn cases where the investor initiates the transfer,transfer the information must be provided within 30 days ofafter the transfer.

IfWhere youthe doold ISA manager does not send the transfer history form to the new ISA manager when transferring the ISA, youthey should:

• notify the new ISA manager of the type of ISA (cash, stocks and shares, innovative finance, or lifetime ISA) and the amount transferred
• send the transfer history form to the new ISA manager within 30 calendar days of the date of transfer

Transfer history forms

YouManagers can download model ISA transfer history forms.

YouISA manager can use yourtheir own transfer history forms. However, they must contain the same information as model forms.

Complete transfer history forms as follows:

Full name

EnterISA managers should enter the investor’s:

• forenames,forenames or theirthe first name and initial
• initial, and the surname

of the investor.

Full permanent residential address

EnterISA managers should enter the full residential address of the investor.

You must provide the investor’s current permanent address, including postcode. You can use addresses for a:

• retirement home
• nursing home
• hospice or hospital
• British Forces Post Office

‘Care of’ or other correspondence addresses are not permitted.

If youWhere doan not know the investor’s permanent residential address,address youis shouldin notdoubt, acceptISA furthermanagers subscriptionsshould fromstop themaccepting subscriptions until youthe arecorrect givencurrent theiraddress currenthas address.been obtained.

Postcode

EnterISA managers should enter the full postcode of the investor.

Date of birth

This should be reported in the format DDMMYYYY.

ForThe example, the date of birth of an investor born on 3 June 1932 should be reported as 03061932.

If you only know the investor’s year of birth,birth report that they were born on 1 January of thatthe year.investor Foris example,known 01011932.

If the ISA ismanagers ashould Lifetimereport ISA,01011932. youIn mustrespect reportof lifetime ISAs the investor’s full date of birth.birth must be reported.

National Insurance number

This should be in the format QQ123456C. YouThe canfinal omitcharacter, thewhich finalwill characteralways (A,be A, B, C or D)D, ifis not critical and ISA managers may omit it isif unknown.not known.

If the investor does not have a National Insurance number, leave this entry blank.should Ifbe yourleft blank unless the ISA manager’s system requires youthe tocapture enterof a National Insurance number,number. useIn that case the ‘universal dummy National Insurance number’ (QQ999999A). DoQQ999999A should be used. ISA managers must not use any other dummy or substitute National Insurance number.

IfIn therespect ISAof islifetime a Lifetime ISAISAs, you must report the investor’s full National Insurance number.number Youmust cannotbe leavereported. theIt entryis blanknot acceptable to not provide this information or to use the universal dummy National Insurance number.

Account number

EnterISA managers must enter the account number from yourtheir own records. WhenIn transferringthe case of a Lifetimelifetime ISA, being transferred this must be the same number that was previously used to report the account to HMRC.

Type of ISA

YouISA managers must enter:enter either:

• ‘A’ if current year subscriptions are being transferred
• ‘X’ if current year subscriptions are not being transferred

EnterWhere ‘A’ if you are transferring a flexible ISA whichis hasbeing transferred with net current year subscriptions of £0£nil and a valid date of first subscription.subscription, the ISA manager should enter ‘A’.

Date of transfer

This isshould usuallynormally be the date whenof which the new manager agrees to accept the transfer.

It should be reported in the format DDMMYYYY.

Amount transferred

Enter the total amount of cash being transferred.

If any investments are being transferred in specie,specie attach a list and tick the box.

Current year subscriptions

OnlyThis completebox thisshould boxbe whencompleted only where current tax year subscriptions are being transferred (you(‘A’ is entered ‘A’ in the type of ISA box).

Stocks and shares ISA must include any subscription made by the direct transfer of shares from a schedule 3 Save As You Earn (SAYE) option scheme, an approved profit-sharing scheme or a schedule 2 Share Incentive Plan (SIP) in the total box and also report it separately in the share scheme transfers box.

For non-flexible ISAs, enter the total amount subscribed to the ISA in the current tax year.

For flexible ISAs, youthe old manager must provide the new manager with the ‘net’ subscriptions in the current year. That is, the total subscriptions in the year less any amounts withdrawn. TheWhere ‘net’withdrawals subscriptionsequal areor £0exceed ifthe withdrawalsamounts aresubscribed equala to£nil orfigure greatershould thanbe the amounts subscribed.provided.

ForFlexible both flexible and non-flexible ISAs, disregardwill both be disregarding any:

• additional permitted subscriptions
• defaulted subscriptions,subscriptions including defaulted investment subscriptions
• Help to Buy ISA reinstatement subscriptions

Find out more on how to manage ISA subscriptions for your investors.

For lifetime ISAsISA, include the following must also be included in the notice:

• the amount of government bonus that has been paid inwithin the current year
• the amount of government bonus that has accrued,accrued but not yet been claimed or paid at the date of the transfer
• details of any qualifying additions for which a claim has not yet been made but with separate entries in respect of a Help to Buy ISA transfer
• any other qualifying additions

Share scheme transfers

This box should only be completed when:only where:

• the ISA is a stocks and shares ISA or a lifetime ISA
• current tax year subscriptions are being transferred (‘A’ is entered in the type of ISA box)
• the current year subscription includes shares transferred from a schedule 3 SAYE option scheme or a schedule 2 SIP

Enter the market value of the shares onat the date on which they were transferred into the ISA.

If the transfer is from a stocks and shares ISA to a cash ISA, the receiving cash ISA manager can ignore the entries made here as they do not need to include the details on their annual ISA return.

Date of first subscription in current year

This box should only be completed ifonly where current tax year subscriptions are being transferred (you(‘A’ is entered ‘A’ in the type of ISA box).

Enter the date on which the first subscription was made in the tax year of transfer. It should be reported in the format DDMMYYYY.

UseWhere the Bankersnet current year subscriptions are £nil, and managers are unable to override the Bacs (Bankers Automated Clearing SystemSystem) (BACS) default date of first subscription (6of April)6 if:

• April, the nettransfer currentshould yearproceed subscriptionsusing are £0
• you cannot override the BACS default date

of 6 April.

For flexible ISAsFlexible ISA, use the date is that of the first subscription in the current year subscription that counts towards the subscription limit.limit, Thewhich does not include replacement of anamounts amountpreviously withdrawn earlier in the currentyear. This yearwill doesbe notdisregarding count towards the limit.

Disregard any:

• additional permitted subscriptions
• defaulted subscriptions including defaulted investment subscriptions
• Help to Buy ISA reinstatement subscriptions

Find out more on how to manage ISA subscriptions for your investors.

Date onof which the lifetime ISA was opened

IfWhere the account transferred is a Lifetimelifetime ISA, the notice must also give the date whenon itwhich that lifetime ISA was first opened. In respect of either:

• defaulted lifetime ISA subscriptions
• a returned withdrawal from a lifetime ISA following a failed first time residential purchase

The date on which the lifetime ISA was opened (if opened for the purpose of receiving such payment) is to be treated as being the same lifetime ISA from which the original payment originated.

Withdrawal for a first-time residential purchase

IfWhere the account transferred is a Lifetimelifetime ISA, the notice must also confirm ifwhether or not there has been a withdrawal for a first-time residential purchase.

It must also confirm ifwhether any of the information required from the conveyancer declaration isremains notoutstanding currentlyand available.if Ifso so, it must also contain an undertaking to pass the information onto the new ISA manager aswithout soon as possible.delay.

ReadFind out more in our guidance on lifetime ISAs for ISA managers.

Date of Transfer

YouWhen andany type of ISA is transferred, the new2 ISA managermanagers must agree a common transfer date. Unless otherwise agreed, this will be either:

• the date included in the ‘transfer acceptance’ section of the ISA transfer authority form
• form, or the date of the investor’s transfer instruction form

form.

The transfer date establishes:

• the date from which the new ISA manager can accept subscriptions
• which ISA manager is responsible for including details of the transferred ISA in theirits lifetime ISA claims and ISA annual returns

The new ISA manager canmay accept subscriptions from the date of transfer if(provided they hold a valid ISA application form.form).

IfWhere an ISA transfer straddles the end of a tax year,year the ISA is included in:in the:

• the new manager’s annual returns if the transfer date is 5 April (or earlier)
• yourold manager’s annual returns if the transfer date is 6 April (or later)

Income youreceived receiveby the old manager after the date of transfer

YouAny shouldincome sendreceived anyby incomethe youold receiveISA manager after thisthe date of transfer should be sent to the new ISA manager unless either:

• youthe haveold manager has been instructed to pay the income youreceived receive to the investor
• the income youreceived receive is less than the minimum amount that the new manager willis prepared to accept

IfWhere thethis receipt includes a government bonus forin respect of a lifetime ISA, youthis must forwardbe thisforwarded directly to the new ISA manager. IfAny youdeparture dofrom notthis dorequirement this,may result in a withdrawal charge maybeing be due.

Information to be provided to the transferring manager by the new manager

IfWhere the account tobeing be transferred is a Lifetimelifetime ISA, the new manager must tellconfirm youto whichthe old manager the type of ISA that the account is being transferred to.

If Where the new account is not a Lifetimelifetime ISA, the transferred amounts will be treated as having been withdrawn from the Lifetimelifetime ISA. Aand withdrawal charge may be due,subject andto youa withdrawal charge, which should deductbe thisdeducted beforeby the transferring themanager fundsprior to transferring the new manager.funds.

Bulk transfers

A bulk transfer takes place whenwhere either:

• two2 managers agree to transfer 2 or more accounts between them without the agreement of the account investors, for example where an ISA manager has decided to rationalise or reorganise their ISA book by selling some or all of it to another manager
• the transfer takes place under an insurance business transfer scheme or a banking business transfer scheme under part 7 of the Financial Services and Markets Act 2000 (FSMA)

Before making a bulk transfer, youthe manager must notify HMRC and yourthe investors whose accounts are being transferred. YourThe notice must:

• givespecify the first day on which accounts will be transferred under the bulk transfer
• be providedprovide at least 30 days before the bulk transfer
• provide the name and address of the manager who will receive the accounts

In addition, yourthe notice to investors must:

• identify the account being transferred
• advise that the investor can arrange a transfer to a manager of their choice if they supply instructions by a certain date
• specify the date for receiving those instructions
• state that if the investor opts out of the bulk transfer but doesfails notto provide further instructions in time, they will lose their ISA status (except for Junior ISA)), — in the case of a lifetime ISA, this will be treated as a withdrawal and may be liable to a withdrawal charge

IfWhere youthe manager will stopcease offeringto offer ISAs after the bulk transfer,transfer youthey must makeensure yourthe final returns are made so yourthat HMRC recordrecords can be closed.

Find out aboutmore on ceasing to be a manager.

When making a bulk transfer, youthe doold notmanager need tonot complete separate transfer history forms for each ISA being transferred. Instead,Instead youthey canmay give the new manager a schedule containingthat contains the information that would normally be entered on the transfer history forms.

AlongsideWhere themanagers schedule,adopt youthis approach, they must also send a covering notice to the new ISA manager. This notice should identify the ISAs being transferred by referring to the accompanying schedule.

If the transfer takes place to an existing account held with the new manager, the investor can make further subscriptions to the account if the application form held by the new manager for that account is still valid. ReadFind out more in our guidance on what you need from investors when they apply for an ISA.

If the transfer is made to a new account, the new ISA manager can only accept subscriptions to that account if an application form has been given to the new manager and that application is valid.

IfWhere thesubscriptions investorwere being made subscriptions to youthe old manager by direct debit, the new manager cannot usecollect payments under that direct debit to collect payments until theyhe holdholds a valid application form. They canmay accept the money provisionally,on buta ifprovisional theybasis dobut notif receive a completed application form is not received within 30 days,days theythe must:

• manager must void the subscription
• and remove the investments purchased with theit subscription from the the ISA

. Alternatively, the manager cancould putplace the money in a suspense account until they receive a fully completed application.application is received.

Group Transfers

A ‘group transfer of accounts’ is a bulk transfer that takes place between members of a 75% group of companies.companies, Forfor example,example thiswhere could be when:

• one of the companies is a 75% subsidiary of the other
• both companiesor both are 75% subsidiaries of a third company

company.

Following a group transfer or a bulk transfer of accounts under Part 7 of FSMA, the new manager can accept subscriptions to the account if:

• the most recent application held by youthe old manager is available to themthe new manager
• that the application to subscribe to an ISA is still ‘valid’

The application is available to the new manager if:

• youif have passed it (or a copy) has been passed to them
• theythe new manager or if the new manager could require youit to makebe itmade available to them

Youthem. The old manager will need to confirm to the new manager that there has not been a gap year where no subscriptions have been made.

An intra-group transfer can include cases where the new manager has accepted an application (usually online) but is still waitingawaiting for the first subscription. If the application is available and still valid, theythe donew manager does not need to getobtain a fresh one.

Subscribing to the ISA after the transfer

If the investor wantsintends to subscribe to the ISA after the transfer,transfer the new ISA manager must getobtain an ISA application form,form unless they already havehold a valid transfer application form.

In that case the application form would be valid for subscriptions made in:

• the year of transfer
• each successive year following the year of transfer, in which the applicant subscribes to the ISA

Other than for a lifetime ISA, it would stopcease beingto be valid at the end of a tax year in which the investor doesfails notto make a subscription. ReadFind out more in our guidance on what you need from investors when they apply for an ISA.

Sometimes,There are some circumstances in which an ISA manager canmay accept an application signed by someone other than the investor. ReadDetailed information on this can be found in the section applying for an ISA on behalf of someone else in How to open an ISA as an ISA manager’.

Reporting Subscriptions made in the year of transfer

WhenWhere current year subscriptions are transferred:transferred the:

• youold ISA manager must exclude the subscriptions from yourthe annual return of information and enter ‘X’ in the type of ISA box
• the new ISA manager must include the subscriptions in theirthe annual return of information and enter ‘A’ or ‘B’ as appropriate in the type of ISA box

DoReporting notin reportrespect informationof aboutlifetime Lifetime ISAs youwill holdnot inbe yourrequired as part of the annual information return (ISAComm100).(ISAComm100) Thiswhich is currently reported to HMRC within 60 days offrom the end of the tax year.

InformationA aboutreport Lifetimeof ISAsinformation shouldwill now be reportedrequired, pertaining only to lifetime ISAs, in a digital format,format specified by HMRC. Readand for lifetime ISAs only. Further information is available on digital reporting for lifetime ISAs.

Claims for payment of tax onin respect of income paid after the transfer date

AsClaims thefor oldpayment manager,of youtax cannotin normallyrespect makeof claimsincome forwith thea payment ofdate tax on income received on or after the date of transfer.transfer may not normally be made by the old manager.

However, youprovided maythat agreethe withold theand new managermanagers thatagree, youthe canold manager may claim payment of tax onin suchrespect of income with a payment date on or after the date of transfer for a period of up to 6 months after the date of transfer.

YouThe old manager should send the income received (and the tax claimed) to the investor if either:

• yourtheir instructions were to pay any income away to the investor
• the amount is less than the minimum the new manager willis prepared to accept

Otherwise, you should forward the income (and tax reclaimed) should be forwarded to the new manager.

IfIn youthe receivecase of income forreceived in respect of a Lifetimelifetime ISA, andany itsuch income that is not paid into thea Lifetimelifetime ISA:

• it of the investor will be treated as having been withdrawn from the Lifetimelifetime ISA
• there, and may be subject to a withdrawal charge, which you should deductbe beforededucted payingby the old manager prior to paying that income to the investor
investor.

If youthe haveold manager has not made, and dodoes not intend to make, a claim forin incomerespect youof income received by them either:

• up to and including the date of transfer
• from the date of transfer

The new manager can make the claim. YouThe old manager should forward the relevant tax vouchersvouchers, to the new manager.manager to enable them to do so.

Cancellation of a transfer

Under the Financial Conduct Authority (FCA) rules, whenstipulated transferringin the FCA’s sourcebook (conduct of business sourcebook), the transfer or an ISA to a new contract,ISA thecontract newmay managerrequire maythe needISA manager to offer the investor the option of either:

• either cancellation rights
• or pre-contractual withdrawal rights (cooling(often off)

referred to as cooling off). The time periods offered bywill thebe managerdictated areby determinedvarious by:factors including:

• the type of ISA being transferred into
• whether the contract is a distance or non-distance (retail) contract
• whether the ISA manager has chosen to offer withdrawal rights rather than cancellation rights
• whether the ISA includes an insurance policy
• whether the manager chooseschoses to voluntarily offer a longer cancellation period than that stipulated in the FCA sourcebook (there are further details on the treatment of tax liability ifprovided the cancellation period does not exceed 30 days)days

Cancellation periods offered are typically between 14 and 30 days and withdrawal periods will be either 7 or 14 days.

If the new ISA manager offers a 7 or 14 day withdrawal period, theythe transfer request should not forwardbe theforwarded transferto requestthe toold youISA manager until thisthe withdrawal period ends.has expired. The investor has 7 or 14 days (the withdrawal period) to reconsider their decision to(the transfer.withdrawal period). If, during thisthe time,withdrawal theyperiod, informthe investor informs the new manager that they dono notlonger wantwish to proceed with the transfer, the new manager should not progress itthe transfer any further. TheyThe transfer request will not forwardbe theforwarded transferto requestthe toold you,manager, andso the old manager may not know that a transfer was ever intended. The funds will stay in the original ISA under your management..

If the new manager doeschooses not to offer a withdrawal period, there is a 14 to 30 day cancellation right. TheIn this case the ISA willwould be transferred to the new manager before the 14 to 30 day cancellation period begins.began. If the investor decides to cancel, it is the purchase of the investment in the new ISA that is cancelledcancelled, but not the transfer itself. The investor has an ISA with the new ISA manager. The investor can dochoose anyto of the following:either:

• invest the money in a different investment offered by the new ISA manager (for(in Lifetimerespect of lifetime ISAs that the account remained within a Lifetimelifetime ISA wrapper)
• close the ISA (for(in Lifetimerespect of lifetime ISAs, this iswill be treated as a withdrawal sofrom a lifetime ISA and will be subject to a withdrawal charge,charge which must be deducted beforeprior closingto the ISA)closure)
• transfer the ISA back to youthe (forold a Lifetime ISA, manager (in respect of lifetime ISAs it must remain within a Lifetimelifetime ISA wrapper or be subject to a withdrawal charge,charge which must be deducted beforeprior theto transfer)
• transfer the ISA to another ISA manager (for(in arespect Lifetimeof ISAlifetime ISAs, it must remain within a Lifetimelifetime ISA wrapper or be subject to a withdrawal charge,charge which must be deducted beforeprior theto transfer)

ReadFurther Lifetimeinformation ISAsis foravailable ISAon managersclosure toof finda outlifetime moreISA aboutin closinglifetime aISAs Lifetimefor ISA managers.

Transfers in that cannot be accepted by the new ISA manager

Sometimes,On occasion, the new ISA manager may be unable to accept an incoming transfer. This is usually because:

• theythe realisenew manager realises that the amount of current year subscriptions being transferred exceed the annual subscription limit (or Lifetimelifetime ISA payment limit) when addedaggregated towith the amount already subscribed with them in the current year
• it arrives after the date by which all transfer proceeds must be received for a structured product (or similar) on sale only for a limited time
• theythe realisenew manager realises that the terms and conditions of the ISA product in question do not allow transfers in

IfIn acceptingthese acircumstances, transferif the amount of current year subscriptions wouldbeing transferred, when aggregated with the amount already subscribed to the new manager in the current year, exceed the annual subscription limit,limit the new manager canhas either:a choice, they may:

• remove the excess current year subscriptions,subscriptions and pay them to the investor,investor and pay the balance into the the ISA — theymanagers can ignore any growth on the amount removed,removed and simply remove the excess subscription amount, however, this does not apply in respect of lifetime ISAs — if the investor claims that the value of the excess subscription is less than the amount originally subscribed, the new manager will need to contact youthe old manager to determine the value — if this is less than the amount subscribed only the value needs to be removed

• return the current year subscriptions to you,the old manager, together with a note explaining why they cannotare unable to accept them

In all other circumstances, the new manager should return the cheque to you,the old manager, together with a note explaining why they cannotare unable to accept it.

This Returning funds to the old manager could leave the transfer ‘inin limbo’‘limbo’ because:

• you, as the old manager,manager havehas followed the instructions to transfer out
• and a transfer out has happened under the ISA regulations
• (notwithstanding the new manager has not processed the transfer in

in).

InWhere thisthe scenario,old youmanager mustis reinstatewilling theand ISAable ifto itdo isso, athey Lifetime ISA. You should reinstate otherthe types of ISAsISA if you are able to do so. This would put the investor back ininto the position they would have been in had the transfer out notnever happened.

If youIn cannotthis reinstatescenario thelifetime old ISAISAs, youmust canbe allowre-instated by the investorold tomanager.

If put the returnedold or rejected proceeds into another of your ISA products.cannot Forbe reinstated (for example, ifwhere the old product is a fixed-rate product that cannot be re-opened afteronce closure.it has been closed) the old manager may offer the investor the opportunity to place the returned or rejected transfer proceeds into another of their ISA products.

YouThe shouldold manager would need to treat this as an internal transfer between ISA products,products otherwise the sum iswould ahave to be regarded as an ISA subscription and is subject to the ISAannual subscription limits. IfIn these circumstances where the old ISA is a Lifetimelifetime ISA, and the rejected or returned proceeds are not placed in a Lifetimelifetime ISA, this iswill be treated as a withdrawal from a Lifetimelifetime ISA, and amay withdrawalbe chargesubject mayto apply.a Youwithdrawal shouldcharge, deductwhich anyshould withdrawalbe chargesdeducted fromby the proceeds.ISA manager.

YouThe doold notmanager haveis under no obligation to reinstate an the ISA, unlessexcept itfor is a Lifetime lifetime ISA. If youthe doold manager is not wantprepared to reinstate the ISA, youthey should allow the investor to transfer itthe ISA to to another provider, so the the ISA status status of the savings is not lost.

Cash withdrawn in error as a result of incorrect transfer advice by an ISA manager

IfWhere youcash oris thewithdrawn newfrom manageran giveISA incorrectin adviceerror aboutas a transferresult application,of andincorrect thisadvice leadsfrom toeither cashthe beingold withdrawnISA frommanager anor the new ISA manager in error,relation to a transfer application, HMRC may allow reinstatement ifwhere there is clear evidence that:

• of the investorinvestor’s intendedintention to transfer the ISA
• and the incorrect advice was given to them by anthe ISA manager

manager.

Flexible ISA transfers

Where a Flexible ISA is transferred, youthe old manager must provide the new manager with:

• the ‘net’ subscriptions in the current year, which is the total subscriptions in the year less any amounts withdrawn (disregarding any additional permitted subscriptions,defaulted subscriptions and Help to Buy ISA reinstatement subscriptions, —where if withdrawals equal or exceed the amounts subscribed,subscribed provide a £0£nil figure should be provided
• the date is that of the first subscription in the current year that counts towards the subscription limit, which is the date of the first subscription that is not a replacement of amounts previously withdrawn in the yearyear, — additional permitted subscriptions and defaulted subscriptions should be ignored for this purpose

UseWhere the net current year subscriptions are £nil, and managers are unable to override the Bacs default date of first subscription (6of April)6 ifApril, both:

• the nettransfer yearshould currentproceed subscriptionsusing are £0

• you cannot override the Bacs default date of 6 April.