Can I transfer a Fixed Rate ISA?
If you’ve already got a Fixed Rate ISA and you’ve found a better deal elsewhere, you can avoid missing out with the help of an ISA transfer. Before you make the switch, here are a few things to watch out for.
Withdrawing funds before maturity will incur a charge. Partial withdrawals from a Fixed Rate ISA are restricted. Tax treatment depends on individual circumstances and may be subject to change in the future
Can I transfer a Fixed Rate ISA?
Yes, you can usually transfer a Fixed Rate ISA from one provider to another, even if you’ve not yet reached the end of your fixed term. However, some providers charge a penalty for transferring out early, so you’ll need to do some quick calculations to work out whether it’s worth it.
Learn more: Can you add money to a Fixed Rate ISA?
How much is the penalty?
It all depends on your provider and their terms and conditions, but it’s usually calculated as a loss of interest. If you’ve held your ISA for less than the minimum charge period, the penalty may come out of your original deposit. So it’s worth checking the T&CS before you request a transfer or open a Fixed Rate ISA in the first place.
Below are some examples of what the penalty for leaving a Fixed Rate ISA early could be for different term lengths. Keep in mind that your current provider may charge a different penalty for ending your current Fixed Rate ISA early, so make sure you check their T&Cs first!
- 90 days’ interest for a 1-year fix
- 180 days’ interest for a 2-year fix
- 365 days’ interest for longer terms
Can I transfer into a Fixed Rate ISA?
Yes, you can transfer your savings into a Fixed Rate ISA, but usually your chance to do this is when you first open the account, or during an initial deposit window, such as up to 30 days after you first open the account.
If you originally deposited the money during previous tax years, a transfer won’t affect your current £20,000 ISA allowance. Just make sure you check the terms and conditions of your current ISA so you’re aware of any restrictions!
Learn more: When does your ISA allowance reset?
Why should you transfer a Fixed Rate ISA?
You may want to transfer a Fixed Rate ISA if:
- You’ve found a better interest rate elsewhere
- Your circumstances have changed and you want more flexibility
- You want to consolidate your ISAs in one place
- You’re switching to a provider that lets you make more deposits throughout the term
- You’re looking for better customer service or more flexible account management
In some cases, you can end up better off even after paying a penalty, especially if you’re transferring into an ISA with a longer-term fix or better rate. But you’ll need to crunch the numbers before you make a move!
How do I transfer a Fixed Rate ISA?
When you want to transfer a Fixed Rate ISA, make sure you don’t withdraw the money yourself, even if it seems like the quickest and easiest option. To protect your savings’ tax-free status, you’ll need to ask your new provider to complete the transfer for you.
The transfer process can vary depending on the provider, but it usually looks a little something like this:
- Open a new ISA (or choose an existing one that accepts transfers)
- Ask the new provider to initiate the transfer
- Complete a transfer form
- Let the new provider handle the rest
The transfer usually takes around 7–15 working days, but it can take longer than this depending on your old provider and whether you’re moving cash or investments.
Perfect for you: The best Cash ISAs in the UK right now
Can I transfer part of a Fixed Rate ISA?
Not usually, as most providers will normally only let you transfer the full balance of a Fixed Rate ISA, especially if you’re midway through a fixed term.
