What is an ISA and what benefits does it offer me?
An ISA (Individual Savings Account) is a tax-free savings or investment account that gives you the opportunity to save or invest a certain amount of money every year, without having to pay tax on any growth in your investments or savings. There are 4 types of adult ISA available (stocks & shares ISA, cash ISA, innovative finance ISA , and lifetime ISA). The interest on cash accumulates on a tax-free basis, as does income and capital gains made on investments.
A stocks and shares ISA lets you invest in “qualifying instruments” such as stocks and shares, funds, etc. A stocks and shares ISA is not an investment in its own right. The best way to think of a stocks and shares ISA is as a ‘wrapper’ with which you can shelter your savings and investments from both Income Tax and Capital Gains Tax. The IBUK Stocks and Shares ISA lets you choose from a range of investments to invest in (see below section 10 ‘What can I invest in?’). You can select and manage your IBUK Stocks and Shares ISA yourself or arrange for your financial advisor to do so on your behalf (see below section 8 ‘Can I appoint a financial advisor to manage, on a discretionary basis, my IBUK Stocks and Shares ISA?’).
When deciding which type of ISA to open, you should consider the pros and cons of each so that you can choose the type that best fits with your personal needs, circumstances and financial goals. We offer stocks and shares ISAs only.
Tax treatments depend on your individual circumstances and may change in the future.
What ISA types are offered at IBUK?
Interactive Brokers (U.K.) Limited (IBUK) only offers stocks and shares ISAs (including, Junior Stocks and Shares ISA). IBUK does not offer cash ISAs (including, Junior cash ISA).
Who is eligible for an IBUK Stocks and Share ISA?
In accordance with HMRC regulations, any individual who is a resident for tax purposes in the UK and over the age of 18 is eligible to open a stocks and share ISA.
Click on the link for additional details: https://www.gov.uk/tax-foreign-income/residence
How many ISAs can I have?
There is no overall limit on the number of ISA accounts, but you can only subscribe to one type of each ISA in the same tax year. This means if you have already subscribed to a Stocks & Shares ISA with a different provider in the current tax year, you cannot also subscribe to an Interactive Brokers Stocks & Shares ISA.
What is a flexible Stocks and Shares ISA?
ISA flexibility refers to whether you’re able to withdraw from your ISA without affecting your annual allowance. A flexible stocks and shares ISA allows the individual to withdraw funds from their stocks and shares ISA and put them back into it, within the same tax year, without affecting their annual ISA allowance.
Does IBUK offer a flexible Stocks and Shares ISA?
No, an IBUK Stocks and Shares ISA isn't flexible. That means you can take money out, but it'll count towards your annual ISA allowance if you pay it back in the same tax year.
Can you lose your money paid into a Stocks and Shares ISA?
The value of investments you hold in your IBUK Stocks and Shares ISA and the income received from them can fall as well as rise. As a result, you may get back less than you invested. Past performance is not an indication of future performance, and some investments need to be held for the long term to achieve a return. The IBUK Stocks and Shares ISA is an execution only service, Interactive Brokers does not provide investment advice. If you need advice about whether an investment is suitable, you need to consult a suitably qualified financial advisor.
Can I appoint a financial advisor to manage, on a discretionary basis, my IBUK Stocks and Shares ISA?
Yes, you can appoint a financial advisor to manage your IBUK Stocks and Shares ISA on your behalf. Click on the link for additional details:
Can I trade on margin under the IBUK Stocks and Shares ISA?
No. You can only open an IBUK Stocks and Shares ISA under a GBP cash account type. A cash account requires that all transactions are made with available cash or long positions.
What can I invest in?
Under a stocks and shares ISA you can invest in any of the following investments (also known as 'qualifying investments'):
- Securities issued by Companies (Stocks);
- Recognised UCITS;
- Depository Receipts, American Depository Receipts and American Depository Shares.
Please note, as of now bond trading in ISA accounts are not permitted.
What exchanges does IBUK support?
HMRC recognised exchanges supported by IBUK:
|The Australian Stock Exchange (and any of its stock exchange subsidiaries)
|Vienna Stock Exchange
|NYSE Euronext Brussels
Toronto Stock Exchange
Montreal Stock Exchange
Toronto Venture Exchange (TSX Venture Exchange)
Frankfurt Stock Exchange
Stuttgart Stock Exchange
|Hong Kong Stock Exchange
|Italian Stock Exchange (Borsa Italia)
Tokyo Stock Exchange
Osaka Stock Exchange
|NASDAQ OMX Vilnius
|Mexico Stock Exchange
|Warsaw Stock Exchange
|Singapore Exchange Limited
|Spanish Stock Exchange (Bolsa de Valores in Madrid)
|Swiss Stock Exchange (SIX Swiss Exchange)
|London Stock Exchange
|United States of America
BATs Exchange Inc
Chicago Board Options Exchange
Chicago Stock Exchange
International Securities Exchange
National Stock Exchange
New York Stock Exchange
NASDAQ OMX PHLX
What is the ISA Allowance for 2023/2024 tax year?
Tax year runs from 6 April to the following 5 April. Each tax year’s ISA subscription limit is specific to that year and can be checked on the HMRC website.
For the 2023/24 tax year the annual ISA allowance is £20,000 per person. Any of the ISA allowance that goes unused in the current tax year cannot be rolled over to the subsequent tax year. You can divide this cash allowance across multiple ISAs, provided that not more than 1 of each type of ISA is subscribed to in any given tax year. NB. If you are already subscribed to another stocks and shares ISA in the current tax year, you are not permitted to subscribe to our stocks and shares ISA for the remainder of the tax year.
For each tax year, you can check (via the funding page in Client Portal) how much you have subscribed to your IBUK Stocks and Shares ISA and the maximum amount that you can contribute to your IBUK stocks and shares ISA in that tax year, assuming you have not contributed to another ISA away from us.
How do I make subscriptions to my IBUK Stocks and Shares ISA?
You can make one-off payments (wire transfers deposits) as and when you choose, but the combined total of all payments (or subscriptions) must not exceed any given annual tax year allowance (see section 12. What is the ISA Allowance for 2023/2024 tax year?).
Interactive Brokers accept wire transfers only, and there is a minimum subscription amount of £1. Your IBUK Stocks and Shares ISA can only have GBP cash.
Can I fund my ISA via Internal Transfer from my existing account?
Yes, as long as the existing account is an individual account in the same name, an internal transfer can be requested to fund your ISA account.
Can I check the tax-year to date contributions I have made into my ISA account?
Yes, if you create a deposit notification for a fund transfer, before selecting "Get Transfer Instructions" on the final page there is a contribution tracker showing how much you have contributed so far during the current tax year.
What happens if I exceed my ISA allowance?
If you have accidentally paid too much into your ISAs you won’t get any tax relief on the excess payments you’ve made. The ISA allowance is a combined annual limit across all adult ISA types (e.g. stock & shares ISA, cash ISA, innovative Finance ISA , and lifetime ISAs).
What should I do if I exceed my ISA allowance?
In the event you oversubscribe to your ISA (in other words your ISA annual allowance was exceeded), you should not attempt to correct the mistake by withdrawing the excess funds from an ISA (including, but not limited to, your IBUK Stocks and Shares ISA). Instead, you should call HMRC’s ISA helpline to explain the situation and inform them about the oversubscription. HMRC will advise you on the next steps. NB. The ISA allowance for the tax year 2023/2024 is GBP 20,000 (this is a combined limit across all 4 types of ISA (stock & shares ISA, cash ISA, innovative finance ISA , and lifetime ISAs).
What is the annual fee for the IBUK Stocks and Shares ISA?
There is no annual ISA fee at IBUK. Other costs and charges apply, see below section 19 for more information.
What are the charges for the IBUK Stocks and Shares ISA?
£3 per month minimum activity fee. (e.g. if you generate 2 pounds of commission in a particular month, you would be charged the remaining balance of 1 pounds as a minimum activity fee. Generate 3 or more pounds in consolidated commission from linked accounts in a month and there will be no fee.)
One free withdrawal per month. Thereafter, £7 withdrawal fee is applicable.
Click here for an overview of our commissions:
What transactions are allowed and what transactions are not allowed in an ISA?
a) Example of allowed transactions
An individual subscribes £15,000 into a stocks and shares ISA, £3,000 into a cash ISA and £2,000 into a lifetime ISA. No more than 1 of each type of ISA was subscribed to in the tax year, and the annual ISA allowance of £20,000 was not exceeded.
b) Example of disallowed transactions
An individual subscribes £10,000 into one stocks and shares ISA, £2,000 into another stocks and shares ISA, and the remaining £8,000 into a cash ISA. While the individual did not exceed the annual ISA allowance of £20,000, they subscribed funds into more than 1 stocks and shares ISA.
How do I transfer my stocks and shares ISA from my current ISA manager to IBUK?
Position/in-specie transfers are now available from certain ISA managers. When requesting a transfer in the client portal supported providers will have a position transfer option within the form.
You will need to submit a transfer instruction to Interactive Brokers (go to Client Portal, Transfer & Pay, then Transfer Existing ISA), and if, in IBUK’s discretion IBUK decides to accept the transfer, IBUK will instruct your existing ISA manager to transfer your investments (where IBUK supports such investments) and/or cash into your IBUK Stocks and Shares ISA. Where IBUK does not support all your investments held at your existing ISA Manager, you can either liquidate these investments yourself prior to submitting your transfer instruction to IBUK via Client Portal (any cash proceeds of such liquidation will be transferred into your IBUK Stocks and Shares ISA) or you can instruct IBUK (as part of your transfer instruction via Client Portal) to do so on your behalf.
Interactive Brokers do not support partial transfers, only full account transfer requests can be made.
How do I transfer an ISA out of IBUK to another provider?
Any transfer out request from IBUK must be requested via the receiving ISA provider. The requesting broker can email a client-signed transfer form to firstname.lastname@example.org or the client may attach a completed form to a web ticket.
What are the Transfer Charges?
Interactive Brokers do not charge for transfers (the transferring ISA manager may charge you for transferring investments or cash proceeds to us).
Can I cancel my IBUK Stocks and Shares ISA?
You have a legal right to cancel your IBUK Stocks and Shares ISA if you change your mind but there are time limits on doing so, see below section 25 for more information.
How can I cancel my IBUK Stocks and Shares ISA?
If you want to cancel your IBUK Stocks and Shares ISA, you must do so within 14 days from the date you receive our email confirming the establishment of your IBUK Stocks and Shares ISA (a cancellation must be requested from the Client Portal).
Cancellation rights will also apply to the receipt of transfer payments. You have 14 days from the date you receive our email acknowledging the transfer to exercise your right to cancel (a cancellation must be requested from the Client Portal). NB. If you cancel the transfer of your stocks and shares ISA from another ISA manager to IBUK, that ISA manager may not agree to accept the stocks and shares ISA back. This may result in that stocks and shares ISA being closed, and the tax benefits being lost.
How safe is your IBUK Stocks and Shares ISA?
IBUK is authorised and regulated by the Financial Conduct Authority (FCA), and is approved by HMRC to act as an ISA manager (including in respect of stocks and shares ISAs).
Under our client terms, and in accordance with the FCA rules relating to client money and assets (Assets), IBUK will be responsible for holding and protecting your Assets. IBUK is required to separate your Assets from its own resources. IBUK is not permitted to use your Assets to carry out its business activities.
In the unlikely event that IBUK became insolvent, an administrator would be appointed to return your money/assets to you. If there is any shortfall, eligible claims will be covered by the UK Financial Services Compensation Scheme (“FSCS”). The FSCS is an independent body set up by the UK Government to pay compensation if a UK firm, such as IBUK, is in default and cannot meet any valid claims against it. FSCS claims are limited to £85,000 per client. Please note, the FSCS applies to designated investments and may not cover all investments or transactions (and in particular these protections don’t apply to investment losses). For more information on the FSCS see www.fscs.org.uk.
How can I file a complaint with IBUK?
Customers are actively encouraged to use the WebTicket system for prompt attention.
A copy of our Complaints Procedure is available here https://www.interactivebrokers.com/en/index.php?f=292 You can also direct your ISA specific complaints via email to email@example.com (Please note that in order to ensure that your complaint is flagged and given the required attention, Interactive Brokers kindly asks you to state "COMPLAINT" in the subject header field of the email).
Are Corporate Actions allowed under my IBUK Stocks and Shares ISA?
Allowed to participate but cannot exceed the annual ISA subscription limit. If it were to exceed the subscription limit, the shares should be transferred to a non-ISA account (see above sections 17 ‘What should I do if I exceed my ISA allowance?’.
FX Handling and your IBUK Stocks and Shares ISA
We will automatically convert currencies when trading non-GBP denominated securities. To do this, we will engage in “spot” currency transactions on your behalf in order to settle your buy orders or convert the proceeds of a sell order. For opening orders we will base the exchange rate off the spot exchange rate at the time of trade plus our 0.03% fee. For closing orders any non GBP balances will be closed at the end of the trading day at the closing exchange rate of the day plus our 0.03% fee.
The below example illustrates the cost in GBP of a $1,000 USD Trade
Example GBP/USD Spot Rate: 1.3432/1.3433
|FX Conversion Rate inc 0.03% fee
|Cost of $1000 USD Trade
Can I allow my IBUK Stocks and Shares ISA to be used as security for any borrowing?
No. In accordance with HMRC regulations, any investments and/or cash within your IBUK Stocks and Shares ISA will be, and must remain, completely beneficially owned by you and you must not grant any rights or interests over the investments to any other person (for example, you must not allow your investments to be used as security for any borrowing).
Can my IBUK Stocks and Shares ISA participate in the Interactive Brokers Stock Yield Enhancement Program (SYEP)?
No. In accordance with HMRC regulations, IBUK ISA holders are not eligible to participate in the SYEP.
What if I have additional questions?
Our client services team are on hand to help via phone or email. If you have any questions about your IBUK Stocks and Shares ISA, please contact our dedicated ISA Support team who are available 8am to 6pm GMT Monday to Friday, excluding public holidays.