What is the easiest and most cost-effective way of moving a portfolio of shares into an ISA wrapper?

12 January 2022

Question by Debbie

I have inherited a portfolio of shares outside of an ISA. What is the easiest and most cost effective way of moving them into an ISA wrapper?

Answered by Boring Money

Hello Debbie,

Thanks for your question. The maximum you can invest/save into an ISA each year is £20,000 so, depending upon the amount you have inherited, it may take a number of years to move them into an ISA.

It also depends upon where the shares are held. If they are held on an investment platform such as Hargreaves Lansdown or Interactive Investor, you should be able to transfer them from the share dealing account to an ISA account pretty easily and at a relatively low cost.

However, if they are directly held shares through a dealing account like Equiniti who don't provide ISA wrappers, you will need to sell sufficient shares to the value of £20,000 each year and then once you have received the proceeds re-invest it into an ISA. There will be share dealing costs for each sale every year, typically of around £15 but possibly higher.

You might also be aware that investing in a smaller number of individual company shares is much riskier than investing across a whole stock market or global stock markets where the effect of one or two companies performing poorly will be significantly reduced for you. Not only that, by investing across stock markets you are going to be guaranteed to hold the future winners even if you don't which companies they are yet.

On this basis, you could sell all the shares you hold (but be aware of potential capital gains tax liability) and invest in a range of global stock market indices. This would also make it easier to use your ISA allowance each year.

Of course, the shares you currently own could do better than the main stock markets as a whole but it is a higher risk strategy.

I hope this helps.


Answered by

Boring Money