Guidance

Tax-free savings newsletter 21 — June 2026

Published 4 June 2026

1. Cryptoasset Exchange Traded Notes and long -term asset funds guidance update

We have updated the ISA manager guidance to reflect the amendments to the ISA regulations which were made and laid before the House of Commons on 11 March 2026 and came into force on 6 April 2026:

• stocks and shares ISA investments for ISA managers
• innovative finance ISA investments for ISA managers
• submitting returns of information for ISA managers

The ISA14a annual statistical return will be updated shortly so that investments in a long-term asset fund (LTAF) and investments in cryptoasset Exchange Traded Notes (cETNs) can be reported.

cETNs are restricted to Innovative Finance ISAs from 6 April 2026. cETNs already held within a stocks and shares ISA immediately before 6 April 2026 will continue to be treated as qualifying investments for as long as they remain in that account. No new purchases or transfers of cETNs are permitted into a stocks and shares ISA from that date.

LTAFs are now qualifying assets for stocks and shares ISAs and LTAFs that were held in an innovative finance ISA immediately before 6 April 2026 are to be treated as qualifying investments for a stocks and shares ISA from that date onwards.

2. Junior ISA guidance update

The Close, void or withdraw investments from a Junior ISA as an ISA manager guidance was updated to include a new section ‘Request for withdrawal of ‘misdirected’ Junior ISA payments’ on 1 April 2026. This reflects the advice provided in Newsletter 6 (November 2022).

This guidance only applies to Junior ISAs, as locked‑in accounts under Regulation 4ZD or Regulation 4ZE of the ISA Regulations.

3. Resolving Lifetime ISA queries

As a Lifetime ISA account manager, you should aim to resolve your investor’s queries in line with the Lifetime ISAs for ISA managers guidance, which covers multiple scenarios.

Where you are unable to resolve the query, you can email HMRC for advice at savings.audit@hmrc.gov.uk quoting the relevant legislation, guidance and investor issue.

4. Digital ISA reporting service user research

We are looking for ISA managers to take part in upcoming user research sessions focusing on managing and submitting ISA-related information to HMRC. These are informal 60-minute conversations where participants can share their experiences, feedback and ideas.

Your input will help shape future product decisions and improve the service.

The sessions will focus on how organisations notify HMRC when they have added or removed an ISA component.

Sessions are relaxed, confidential and open to everyone, whether you are a long-time user or completely new, every perspective is valuable.

Upcoming research dates:

• Monday 8 June 2026
• Monday 22 and Tuesday 23 June 2026

If you’re interested in participating in the upcoming or any future research opportunities, email enquiries.savings@hmrc.gov.uk to be contacted when sessions become available.

5. ISA compliance

The government will introduce a new ISA compliance regime to provide a clearer and more proportionate framework for overseeing ISA managers, aligned with its wider approach to transparency, digitalisation and improving data quality.

The changes are intended to address risks identified in the Gloster Review 2020, strengthen customer protections and support the move to digital ISA reporting.

Regulatory breaches — minor

This category covers low-level breaches where there is no tax loss and investors have not been disadvantaged. These are typically administrative issues, such as ISA transfers not being completed within the statutory time limits. The penalty applied will be £1 per account, per year of the breach.

Regulatory breaches — serious

Serious regulatory breaches relate to more significant failures that undermine the integrity of the ISA rules, for example where ineligible investments are allowed to be held within an ISA. The penalty applied will be initially set at £8 per £1,000 per account per year. This will apply to all ISA components.

The amount charged will be subject to regular review following any changes to the Financial Conduct Authority growth projections for stocks and shares and innovative finance ISAs, and the Bank of England base rate for cash ISAs.

Failure to submit monthly, annual returns or both

This penalty will apply where required returns are not submitted to HMRC. It will operate through a points-based system, as currently in place for Making Tax Digital for VAT and Income Tax Self-Assessment, with one penalty point issued for each missed return.

The points-based system has different thresholds depending on the frequency of the returns, for example, 5 points for monthly returns and 2 points for annual returns. Given that ISA managers will be subject to multiple filing obligations with differing frequencies (monthly and annual), points issued for these obligations will sit within a single pot and, for the purposes of the points threshold, annual returns will be treated as though they were monthly returns.

Therefore, for digital ISA reporting, once 5 points are accumulated, a £200 penalty will be charged. Thereafter, each additional missed return will result in a further £200 penalty, ensuring that continued non-compliance leads to financial consequences.

Where the threshold has not been reached, each point will automatically expire after 24 months.

Once the points threshold has been reached, points will be reset to zero once all returns are submitted on time for 6 months.

Inaccurate or incomplete reporting

This penalty will apply where submitted returns contain errors, either due to deliberate behaviour or a failure to take reasonable care. The penalty will range from £1 to £100 per affected account, depending on the nature and seriousness of the behaviour, with higher amounts reserved for deliberate, fraudulent behaviour or both.

This ensures the amount charged reflects both the severity of the conduct and the impact of the inaccuracies on reporting.

Suspension

Suspension will apply mostly in cases of persistent non-compliance, especially in circumstances when withdrawal of ISA manager approval is not considered appropriate. Rather than a financial penalty, this involves a temporary restriction on activities, such as accepting new subscriptions or transfers, until compliance is restored.

The existing powers of withdrawal or refusal of approval, as well as penalties for failure to comply with a notice, will continue.

All elements of the regime will be supported by standard appeal rights.

The new ISA compliance package will take effect from April 2028, with the suspension power introduced earlier, from April 2027. Full guidance will be provided ahead of implementation.

6. Deferral of National Insurance number requirement for existing ISAs

The government will defer the requirement for existing ISA account holders to provide a National Insurance number before making a subscription until April 2028, maintaining alignment with the postponement of the Digitalisation of ISA Reporting (DISA) programme.