Bed and ISA

Do you hold shares outside of an ISA? Find out about the benefits of moving the shares into an ISA and start sheltering your investments from tax.

What is Bed and ISA?

Bed and ISA is a term that refers to the process of taking existing shares you already hold, and placing them into an ISA. You may hold the shares electronically (with us or with another provider) or in certificate form; these can all be placed into an ISA provided you have not fully subscribed it this tax year. The process involves selling the shares and repurchasing them, due to the government rules about placing money into an ISA.

Why should you Bed and ISA?

Placing shares that you already hold into an ISA can have some key benefits. Income through dividends will have no further income tax to pay and any gain made from selling shares would no longer be subject to capital gains tax. This means the sooner you move the shares into an ISA, the sooner you may be able to start benefitting from the tax advantages. Please note, when selling shares to put into an ISA, this could trigger a capital gain or loss. Whilst there may be tax to pay on this, you do have a capital gains tax allowance so there may be none to pay at all.

Click below to explore three ways to Bed & ISA

Existing shares in an account with The Share Centre

If you hold the shares in an account with us and you already have an ISA with us, the process is simple.

  1. Contact our dealing team by phone (01296 414243) or email (dealing@share.co.uk) and advise them that you would like to perform a Bed and ISA.
  2. We'll sell the shares in your existing account (for which you will pay dealing commission), transfer the proceeds into your ISA and then re-purchase the shares (no dealing commission to pay, but stamp duty may be applicable).

Due to the difference between the bid price and the offer price, you will typically buy back less shares than you originally held. The process counts as new money into the ISA, so you need to have a Stocks and Shares ISA for the current tax year that has not been fully subscribed.

Transferring share certificates into an ISA

If you already hold an ISA with us, follow these steps;

  1. Complete our form (download here)
  2. Post this to us along with the share certificates and any other requirements (as detailed on the form). As share certificates can be costly to replace, we recommend sending them into us using a recorded or insured postage option.
  3. Upon receipt of your documents we'll process a sale of the shares on the certificate (for which you will pay dealing commission), transfer the proceeds into your ISA and then re-purchase the shares (no dealing commission to pay, but stamp duty may be applicable). This process will take approximately 10 working days to complete.

Due to the difference between the bid price and the offer price, you will typically buy back less shares than you originally held. The process counts as new money into the ISA, so you need to have a Stocks and Shares ISA for the current tax year that has not been fully subscribed.

If you don't already hold a Self-Select Stocks & Shares ISA with us, you will need to open one (click here), then follow the steps detailed above.

Do you hold shares in an account with another provider?

If you hold the shares electronically with another provider, the process will take a little bit longer, so bear this in mind if the end of tax year is approaching.

  1. Complete our transfer in form, (the shares can be transferred into an existing account with us, or you can open a new account using the form). You will also need to have a Self-Select Stocks & Shares ISA with us, or open one.
  2. After the investments have been transferred over from your previous provider, contact our dealing team by phone (01296 414243) or email (dealing@share.co.uk) to the Bed and ISA itself.
  3. We'll sell the shares in your new or existing account with us (for which you will pay dealing commission), transfer the proceeds into your ISA and then re-purchase the shares in the ISA (no dealing commission to pay, but stamp duty may be applicable).

Due to the difference between the bid price and the offer price, you will typically buy back less shares than you originally held. The process counts as new money into the ISA, so you need to have an ISA for the current tax year that has not been fully subscribed.

Further benefits of ISA investing

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Tax-efficient

No Capital Gains Tax or further Income Tax to pay on profits.

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Fixed monthly account fee

£5.00 per month and a dealing option to suit you.

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Invest up to £20,000 this tax year

You'll be able to move up to £20,000 worth of shares across this tax year, the allowance set by the government.

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Pick your own

You can transfer a wide range of investments: shares, funds, investment trusts, bonds, gilts, ETFs and more.

Looking to open a Self-Select Stocks & Shares ISA?

Still need help?Green email envelope

Please get in touch with our Dealing team.

Email: dealing@share.co.uk

Phone: 01296 41 42 43 (8:00am-6:00pm weekdays)

Write: The Share Centre, PO Box 2000, Aylesbury, Bucks, HP21 8ZB

We're unable to provide you with taxation advice for your specific circumstances so if you are unsure what action to take, you might want to consider speaking to a financial adviser.