Worthwhile transferring S&S ISA from Fidelity to Hargreaves Lansdown

Thrupnybit

Inexperienced in stocks and shares ISA but having seen posts here recommending companies like Hargreaves Lansdown rather than our current fund provider Fidelity, I've been looking at transfer from F to HL. If we were to do that, Fidelity would transfer the all funds apart from Fidelity funds (under a fifth of the total) as cash rather than current actual holdings. That's beginning to sound not so good to me, what do you think?

dunstonh

That's beginning to sound not so good to me, what do you think?

The method of transfer isnt really an issue. Cash transfers mean you are out of the market for a few days but thats the only issue. You could re-register instead.

Thrupnybit

Re-register - is this a specific kind of transfer?

Sparky47

Transferring as cash is not really a problem as you can then choose whether to reinvest in the same funds, or take the opportunity to buy something different.

masonic

There may be additional charges for re-registering (transferring your funds without selling them). For example, if you were transferring out of HL, it charges £20+VAT per fund to re-register with another manager, whereas liquidating the holdings and transferring cash incurs no charges.

jimjames

As long as the market doesn't move a lot during the transfer (or drops) then moving as cash is fine.

Unfortunately some providers only offer the cash option so to consolidate that is your only option. I moved my funds from Fidelity and took the gamble that a few days out of the market was worth it to get the flexibility of the HL wrapper.

BFM

hang on though, if you have a S&S ISA and cash it in, then doesn't it lose its tax free status?

i have a similar question as i have 2.5 years worth of ISAs within L&G - if i want to change the profile of my ISA holdings from L&G trackers to the wide range available within H-L, I assume I can do some sort of transfer keeping the ISA wrapper (a la Cash ISA transfers). presumabely there will be some sort of charge to do so, but i certainly want it to remain as an ISA. approx what is the charge and how do I go about it to ensure the taxman keeps his grubby little mits off?

dunstonh

hang on though, if you have a S&S ISA and cash it in, then doesn't it lose its tax free status?

Yes. However, you are not "cashing it in" - not a phrase that applies to ISAs as it happens but often used for historical reasons. You are not drawing the money out of the ISA.

All that is happening is that the provider changes it to cash and transfers it as cash. The new ISA manager receives it as cash and awaits instruction on how to invest. At no point has it left the ISA tax wrapper.

BFM

dunstonh wrote: »

Yes. However, you are not "cashing it in" - not a phrase that applies to ISAs as it happens but often used for historical reasons. You are not drawing the money out of the ISA.

All that is happening is that the provider changes it to cash and transfers it as cash. The new ISA manager receives it as cash and awaits instruction on how to invest. At no point has it left the ISA tax wrapper.

so essentially it is a cash placeholder within the ISA wrapper until you decide what to do with it? assume it doesn't earn any interest in that state?

is it similar to cash isa transfers in that i set up a new iSA in next tax year with H_L and then instruct them to moive the other piece across

Thrupnybit

Thanks for replies. I'm much clearer on this now.

masonic

BFM wrote: »

so essentially it is a cash placeholder within the ISA wrapper until you decide what to do with it? assume it doesn't earn any interest in that state?

It does earn interest at HL, but interest earned on cash in S&S ISAs is taxable.

is it similar to cash isa transfers in that i set up a new iSA in next tax year with H_L and then instruct them to moive the other piece across

Not really, it's just uninvested cash within the ISA wrapper. It isn't held separately.