Information you need from investors when they apply for an ISA
What information needs to be on ISA application forms if you're an ISA manager.
Applications to subscribe to an ISA
Investors must apply to subscribe to an ISA.
Applications are valid for subscriptions made in:
- the year of application
- each successive year following the year of application — subject to eligibility rules for each ISA type
This allows a continuous subscription by direct debit or standing order. The frequency, amount, and method of payment are matters for the ISA manager and the investor.
From 6 April 2024, continuous applications remain valid for payments in any tax year in which the investor is eligible to subscribe. This includes if the investor fails to make a subscription in a tax year. If an investor has been non-UK resident, they should make a declaration to confirm they are now a UK resident, including their permanent UK address. Find out more about residence qualification.
Applications can be made:
- in writing
- by email
- by phone
An investor does not need to apply if they are making flexible ISA replacement subscriptions.
ISA age limits
In the tax year in which they become 18, an investor can apply for:
- a cash ISA
- a stocks and shares ISA
- an innovative finance ISA
- a lifetime ISA
An investor can only transfer funds from a matured CTF or Junior ISA into an ISA or Lifetime ISA on or after their 18th birthday. Find out more about who can invest in an ISA.
Applications in writing
Applications in writing must be made on an application form. They include:
- faxes of signed application forms
- scanned copies of signed application forms, attached to emails
- email applications with electronic signatures
The Electronic Communications Act 2000 defines electronic signatures.
ISA managers should produce their own application forms, which must include:
- the first tax year to which they relate
- a declaration of which ISA type the application is for
- a declaration that the applicant meets the conditions of opening the ISA
- a statement to give certain authorities to the ISA manager
- a declaration that the information given is correct to the best of the applicant’s knowledge and belief
- an agreement to the ISA terms and conditions
- the applicant’s signature
Managers can download separate model application forms for each ISA type. These contain suggested wording that will meet the requirements of the regulations.
Personal information
Applications must contain the applicant’s:
- full name — this does not have to include a middle name or initial, so an application showing Mr John Joseph Bloggs, Mr John J Bloggs or Mr John Bloggs is acceptable but Mr J J Bloggs or Mr Bloggs is not
- permanent residential address, including postcode
- national insurance number, which must be provided for all ISA types
- date of birth (ISA managers should provide an 8 character box so that the investor gives the date in the format DDMMYYYY)
The applicant must be a UK resident in the year they make their application. They will need to prove their residency status. Find out more about residence qualification.
If an applicant is unsure if they are a UK resident, they cannot apply for an ISA. An ISA must not be opened provisionally for an applicant who is unsure if they are a UK resident.
Composite application forms
Managers must obtain separate application forms for each ISA type. Composite application forms that would allow investors to choose between a cash ISA, a stocks and shares ISA, an innovative finance ISA or a Lifetime ISA are not acceptable.
Applications not in writing
An applicant does not have to apply in writing. They can also apply:
- by phone
- by fax
- by unsigned email
- verbally
The applicant must give the same information and authority, and make the same declaration as they would in a written application. They do not need to provide their signature.
There are 2 stages to applications not in writing:
- The application
- The notification of the declaration
When they receive the application, the ISA manager must create a ‘written record’, either on paper or electronically. They must tell the applicant what the ‘written record’ contains. This can be done in several ways.
If the application is made on the:
- phone, or in face-to-face contact, the declaration can be read back to the applicant
- internet, a copy of the declaration can be sent back to the applicant, who should be given the option to print or save a copy
In all cases, a copy of the declaration can be emailed, faxed or posted to the applicant. The declaration must confirm all the details provided by the investor in the application (this includes the name, address, date of birth and national insurance number of the investor). It will satisfy the requirements of the regulations if it takes the same format as a written ISA application form, prefaced by the statement, ‘This declaration records the terms of the application made by the named applicant’.
The ISA manager must keep a record of the date that the investor was notified of the declaration’s contents. This may simply be a flag on the investor’s record on the manager’s computer system which indicates that the investor has successfully completed the ISA application process and ‘confirmed’ or ‘accepted’ the details in the declaration prepared following an internet application. Managers may want to offer a ‘print’ facility for internet declarations.
The application is valid from the date the ISA manager creates the declaration. On notifying the applicant of its contents (which should take place within 5 business days of the date on which the declaration is created), the ISA manager should advise the applicant that they should notify any corrections to the ISA manager.
Correcting applications
Notifications of corrections need not be made in writing. Where corrections are notified the ISA manager must amend the declaration. The amended declaration will take effect from the date on which the original declaration was created. However if, in the original application, the investor declared that they did not have a national insurance number and the manager becomes aware that the investor did have a national insurance number at that time, the manager should void the ISA with effect from the date the original declaration was made. Make a revised declaration, which will re-validate the ISA from the date on which it is created and notify the investor of its contents.
An example of an amendment could be where the investor notifies the manager that part of his national insurance number or date of birth has been transposed. The manager should change the information he holds but a revised declaration need not be issued. This does not affect Lifetime ISAs, where a national insurance number must be given.
Applications made through third parties
Applications may be made through third parties such as an Independent Financial Adviser (IFA). Such applications must be authorised by the investor, but they can be passed to the ISA manager by the third party.
Where an application in writing is made through a third party, the application must be signed by the investor.
Where an application not in writing is made through a third party, managers may accept the application if they have no reason to believe (by reference to information in their possession) that the application has not been authorised by the investor.
Where ‘bulk’ applications not in writing are passed on by a third party, ISA managers must ensure that:
- each investor’s personal details are complete
- the type of ISA each investor is applying for is clear
Unless ISA managers have information to suggest the contrary, ISA managers may accept that authorities and declarations are satisfied by a statement from the IFA.
Whenever an application not in writing is made through a third party, the ISA manager must:
- make a written declaration on behalf of the investor
- send the declaration to the investor, by email, fax or post — read the ‘Applications not in writing’ section of this guidance
Find out more about applying for an ISA on behalf of someone else.
Imaging application forms and written declarations
ISA application forms, transfer forms and ISA written declarations can be stored in an imaged form, and the originals destroyed. The optical images will be regarded as applications for the purposes of the ISA rules provided:
- the imaged application form (and any hard copy printouts) is legible
- on being given notice in writing by HMRC, the manager will make available within such time as specified in the notice a hard copy of the imaged document
- on being required to do so by HMRC, the manager will, within a reasonable time, provide a hard copy of the imaged documents.
Retaining forms
ISA managers must keep the written application form, or an imaged copy of it. Alternatively, they can apply the ‘not in writing’ procedures when they receive a written application.
The manager must:
- make a written declaration, using the information provided on the application form
- send the declaration to the investor — the investor then has 30 days to tell the ISA manager about any necessary corrections
- meet the requirements for applications not in writing
- make application forms, or copies, available for HMRC auditing for 6 years after opening the account
The manager can destroy the original paper declaration after sending a copy to the investor.
ISA terms and conditions
An ISA is a scheme of investment managed in accordance with the ISA regulations by the ISA manager under terms agreed between the ISA manager and the investor (ISA terms and conditions) or their nominee. ‘Nominee’ has its everyday meaning — a person or entity who is named or appointed by another (the nominator) to act on its behalf in a limited capacity or in a specific matter in accordance with any legal or regulatory requirements.
ISA managers’ ISA terms and conditions must specify in writing that:
- the ISA investments will be, and must remain in, the beneficial ownership of the investor and must not be used as security for a loan
-
except for cash deposits or National Savings products in cash ISAs, insurance policies held with an insurer who is also the ISA manager, and innovative finance ISA investments, the title to the ISA investments will be registered:
- in the name of the ISA manager
- in the name of the ISA manager’s nominee
- jointly in the name of the ISA manager and the investor
- jointly in the name of the ISA manager’s nominee and the investor
- except for cash deposits/National Savings products in cash ISAs, and for insurance policies held with an insurer who is also an ISA manager, share certificates or other documents evidencing title to ISA investments will be held by the ISA manager or as the ISA manager may direct
- except for cash deposits/National Savings products in cash ISAs, and innovative finance ISA investments, the ISA manager will arrange, if the investor elects, for the investor to receive a copy of the annual report and accounts issued by every company or other concern in respect of shares, securities or units which are held directly in the ISA — if the investor receives these automatically this fact should be stated in the ISA terms and conditions
- except for cash deposits/National Savings products in cash ISAs, insurance policies, and innovative finance ISA investments, the ISA manager is under an obligation — subject to any provisions made by or under any other enactment, if the investor so elects, to arrange for the investor to be able to:
- attend shareholders’, securities holders’ or unit holders’ meetings to vote
- receive, in addition to the annual report and accounts, any other information issued to shareholders, securities holders or unit holders
- the ISA manager will satisfy themselves that any person to whom they delegate any of their functions or responsibilities under the terms agreed with the investor is competent to carry out those functions and responsibilities (delegation of the manager’s functions)
- the ISA manager must tell the investor if an ISA has, or will, become void because the investor did not follow the ISA regulations
On the instructions of the investor and within the time stipulated by the investor, an ISA, or part of an ISA, shall be transferred to another ISA manager in accordance with the ISA regulations relating to transfers. Transfer rights in relation to non-cash innovative finance ISA investments are available only as set out in the terms and conditions of the account.
Managers may place a minimum period on the time stipulated by the investor for transfer. This period, which should represent whatever reasonable period the manager requires for practical implementation of transfer requests, must not exceed 30 days and must be consistent with requirements relating to transfers between cash accounts — read Transferring your ISA. Additional rules apply for Lifetime ISA withdrawals for first time residential purchases where the 30 days runs from receipt of information from an eligible conveyancer.
On the instructions of the investor and within the time stipulated by the investor, all or part of the investments held in the ISA and proceeds arising from those investments shall be transferred or paid to the investor. Withdrawal rights in relation to non-cash innovative finance ISA investments are available only as set out in the terms and conditions of the account.
Managers should note that where an investor requests a transfer or withdrawal and the ISA holds units or shares in a UK Undertakings for Collective Investment in Transferable Securities (UCITS), a non-UCITS retail scheme or a recognised UCITS, dealings in which have been suspended in accordance with the Collective Investment Schemes sourcebook (COLL) 7.2 (or any direct foreign equivalent), the minimum period specified by the manager may be extended to 7 days after the suspension ends. You do not need to mention possible suspension in the terms and conditions. Find out more about stocks and shares investments.
The terms and conditions should also include wording to satisfy the Financial Conduct Authority requirements on reading and understanding terms and conditions. A failure to include any of the necessary ISA terms and conditions will invalidate all ISAs opened under those terms and conditions. HMRC Audit will take action if they find that an ISA manager has omitted any of the ISA conditions, even if they are applied in practice.
Last updated 8 April 2024 + show all updates
-
A link to the ISA application forms has been added at the section 'Applications in writing.'
-
The age limit has changed for cash ISAs. The requirement to reapply for an existing ISA annually has been removed.
-
First published.