ISA transfers can occur at any time for cash accounts but there are a few things that savers need to be aware of. Before transferring the saver in question will need to ask their existing provider to sort the transfer to ensure the savings retain their tax-free status.
The existing provider must allow the saver to transfer their ISA, it should be noted that not all new providers will accept ISA transfers.
This will need to be checked on before any switch attempts are made.
Additionally, the current provider in place may charge a penalty for transferring away from them.
The costs of these kinds of fees and charges should be examined before any decisions are made to ensure the switch is worthwhile.
So long as a transfer is occurring, savers will be able to not only transfer their current cash ISA but also ISAs from previous tax years.
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This is a relatively new feature, as previously a saver would have had to sell the investments they held, losing the tax perks in the process.
Cash and stocks and shares ISAs are two of the four main types of accounts available, with the remaining two being:
- Innovative finance ISAs
- Lifetime ISAs
All of these types of ISAs have different rules and benefits associated with them but in total, £20,000 can be invested into ISAs in a tax year.
There are also Junior ISAs which can be set up for children aged under 18 but these have a limit of £9,000 per year.
Some savers may also hold a Help to Buy ISA which can no longer be opened but they can still be transferred, so long as the providers involved accept Help to Buy accounts.
It should be noted that transfers do not have to go to banks or building societies as many types of companies accept ISA products
This includes credit unions, stock brokers and crowdfunding companies.