Transferring an ISA while living abroad

pwoodm

Hi all. I opened a high interest ISA with Alliance & Leicester / Santander a couple of years ago which has since dropped to a low interest rate. I am now living in the States and want to keep this money in the UK so I was wondering whether I am able to transfer this money to another high interest ISA account. Is this possible?

Thanks in advance for any advice!

evenasus

From Moneywise...

Unfortunately, if you're resident abroad you can't move your money. This is because, in order to transfer, you need to open a new ISA - and you can only open an ISA if you are ordinarily resident in the UK for tax purposes.

The only exceptions to this are Crown employees, such as diplomats or members of the armed forces, as they are working overseas but are paid by the government.

Similarly, if you start an ISA in the UK before going abroad, you cannot continue putting money into it.

However, you can keep your ISA and you will still get tax-free returns within the UK - although the interest or dividends may be subject to tax in your new country of residence.

xylophone

http://www.hmrc.gov.uk/isa/faqs.htm#14

Q. What happens if I go abroad?
A. You can only open an ISA if you are resident and ordinarily resident in the UK for tax purposes (ask your Tax Office if you are in any doubt about this).

Crown employees, such as diplomats or members of the armed forces, who are working overseas and paid by the government are eligible to open an ISA. Their spouses or civil partners can also open an ISA.

"If you start an ISA in the UK and then go abroad, you cannot continue putting money into the ISA (unless you are a Crown employee working overseas or the spouse or civil partner of a Crown employee working overseas). However, you can keep your ISA and you will still get tax relief on investments held in the ISA. When you return, you can start putting money in again (subject to the normal annual limits)."


The above is the official HMRC guidance - it doesn't say that you can't transfer the ISA? You might want to check the point with HMRC.

Also see https://forums.moneysavingexpert.com/discussion/2207633 post 3
"UK law permits you to transfer to a new ISA. The HMRC sample transfer application forms (page 110) instruct you to strike out the declaration that you're UK resident if you don't intend to subscribe (pay in new contributions, not transferred money) during the current tax year."

Mikeyorks

xylophone wrote: »

The above is the official HMRC guidance - it doesn't say that you can't transfer the ISA? You might want to check the point with HMRC.

And HMRC will tell you that you can transfer it - provided it's pre-existing funds. But no ISA manager will accept you with an overseas address .... so that finishes it. At best you may be able to do an internal transfer - but even that is dubious.

If you're going abroad then you need to move your cash ISAs to an appropriate fixed period. Or give up altogether if your new place of residence means you're paying tax on world wide income -as the ISA status often isn't recognised.

xylophone

In the above thread there is a post which indicates that it might be possible - I have never tried so don't know, which is why I suggested checking - if you don't ask you don't get!
One assumes that the OP advised Santander of change of country when the move took place - if Santander are content with the situation, and HMRC does not forbid, they might be willing to transfer to their better rate ISA?

Cook_County

The income is all taxable in the US. The account is reportable on both the FBAR and the Form 8938. An ISA is of little advantage in these circumstances.

Mikeyorks

xylophone wrote: »

if you don't ask you don't get!

The point being made is that it's a pointless exercise enquiring of HMRC ..... if no ISA provider will take your transfer!

The HMRC guidance is precisely that - there is no compulsion for any ISA manager to accept a transfer. I've never heard of a successful transfer in these circumstances.

xylophone

Cook_County wrote: »

The income is all taxable in the US. The account is reportable on both the FBAR and the Form 8938. An ISA is of little advantage in these circumstances.

The OP simply wants to keep the money in this country?

'" I've never heard of a successful transfer in these circumstances."

https://forums.moneysavingexpert.com/discussion/2207633 Post2

Somebody has?