If your late spouse or civil partner held an ISA and died on or after 3 December 2014, you will inherit an additional ISA allowance called the Additional Permitted Subscription (APS) ISA allowance. The APS ISA allowance allows you to make contributions up to the value of your spouse or civil partner's ISA holding when he or she died. The APS ISA allowance is in addition to your personal annual ISA allowance, and you qualify for it regardless of whether you inherit the actual cash or shares held within your spouse or civil partner's ISA.
How is the APS ISA allowance calculated?
If your spouse or civil partner died between 3 December 2014 and 5 April 2018 the APS ISA allowance equals the value of the ISA(s) as at the date of death.
If your spouse or civil partner died on or after 6 April 2018, the APS ISA allowance equals the higher of the value of the ISA(s) at the date of death or the value of the ISA(s) at the date the ISA(s) cease to be a continuing ISA. Consequently, if the value of the assets in the ISA increases, and you are inheriting the assets, they are able to transfer these in their entirety to an APS ISA and continue to benefit from the tax advantages of an ISA product. The value of the continuing ISA will be valued at the date of death and then again on either the closure of the ISA or on the third anniversary of the death, whichever is earlier. Depending on when the APS ISA allowance is used will determine the value, this will be the higher value calculated before the APS allowance is used or transferred between ISA managers.
Tax rules can change and the impact of taxation (and any tax relief) depends on your circumstances.
You can also download our guide to help you manage the financial arrangements after a bereavement to help you through the process and understand the next steps.
The forms you may need to complete are as follows:
- APS ISA valuation form
An APS ISA valuation form allows us to provide you with a valuation of your deceased spouse or partner's ISA where they held an ISA with M&G. Please note, requesting the valuation for the ISA they held with M&G is not the same as transferring an allowance to us and is simply a request for information.
- APS ISA application form
An APS ISA application form enables you to use your APS ISA allowance by transferring cash or shares to M&G. This form can also be used to make additional subscriptions to use more of your APS ISA allowance.
The value of your investment can go down as well as up so you might not get back the amount you put in.
- APS ISA allowance transfer authority form
An APS ISA allowance transfer authority form provides us with the authorisation to request the transfer of your APS ISA allowance to M&G. We will contact the relevant ISA Manager(s) to confirm the value of your APS ISA allowance so you can start using your allowance with us.
Next steps
Complete and send your application to us at:
M&G Securities Limited,
PO Box 9039,
Chelmsford,
CM99 2XG
Once we have received one or more of the above forms, we will send you a confirmation receipt and let you know what will happen next depending on the option you have chosen.