S&S ISA Transfer with suspended funds

mister_t

I am in the process of transferring my Hargreaves S&S ISA over to Interactive Investor.  I hold 3 funds that can't be transferred, LF Equity Income (woodford) and a couple of propery funds as trades are all suspended.  ii say they can transfer the rest and leave the 3 suspended holdings with HL.  I have contributed ~4k into this ISA this tax year, including into the three suspended funds, however I was under the impression that a S&S transfer had to be in full.  ii are not being much help in clarifying this.  If I go ahead with the transfer am I in breach of the ISA rules and if so, how can I do the transfer without breaking them?  ii say they can't transfer the LF equity one and they don't support the property ones. I have not been able to any info on the web on how to handle suspended funds with transfers.

masonic

No, S&S ISA transfers do not need to be full. Providing either >£4k is transferred or >£4k is left behind so that your current year money is not split between two ISAs of the same type. Previous year subscriptions can be partially transferred but current year money cannot. Some providers will not act on partial transfer instructions. Your instruction was not partial, but circumstances dictate a full transfer cannot be completed. One provider has confirmed this is acceptable, so I would be surprised if the other could now prevent it taking place minus those holdings.

As an aside, I don't really understand why a suspended fund cannot be transferred, since the transfer does not involve a sale, merely a re-registration to a new nominee.

mister_t

Thanks for the reply, that makes sense.  I think the property fund (in two different share classes) is not on ii's list of supported funds so I guess that is fair enough.  The LF Equity one is class Z at Hargreaves while ii only support class C.  I have read that they should be able to transfer between share classes but they say not.

masonic

mister_t said:

Thanks for the reply, that makes sense.  I think the property fund (in two different share classes) is not on ii's list of supported funds so I guess that is fair enough.  The LF Equity one is class Z at Hargreaves while ii only support class C.  I have read that they should be able to transfer between share classes but they say not.

You may find this article of interest regarding unit class conversion: https://citywire.co.uk/funds-insider/news/hargreaves-woodford-fund-investors-free-to-switch-to-another-broker-says-link/a1249271