Is ISA Portfolio transfer worthwhile on small amounts?

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1

I’ve been waiting for a portfolio transfer from Freetrade but they’re so slow that after 3 weeks they’ve yet to even start work on it. I’ve only got around £1k in my ISA portfolio and there’s no way I’ll hit the annual £20k limit. Is there any other reason not to simply close down my Freetrade account and cash out?

2

Do ahem FeeTrade not charge per each individual asset transferred out? You might be better selling, transferring cash and buying back?

“Transferring US securities will incur a cost of £17 per holding.”

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3

Even if you are not liable for a 17.99 exit charge on a stock transfer, I think Freetrade charge 4.99 pcm for the isa, so even if you are out on the bid offer spread, that would probably be less than the monthly charge. I would consider this if there’s no chance of a transfer before the next monthly payment. If you want to hold something that Trading 212 don’t offer, you could consider a general investment account if you are not close to the dividend tax limit or at risk of excessive CGT.

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4

Yes you’re right, I’m going to sell everything that isn’t in GBP before the transfer goes through. If I leave that in the account as cash it will come into T212 without impacting my annual limit - AFAIK that’s the only reason to leave it in there. As also mentioned by @Mark3 if I leave it I will almost definitely incur another £5.99 monthly charge.

I think that worst case if I simply sold everything in FT, withdraw it, and re-deposit into T212 then HMRC would see that I’ve added £1k to FT and £1K to T212 and count that as £2k against my limit. I’d lose on FX rates regardless (though not as bad as the £17 fee per stock to transfer in specie). This is all fine. Any other gotchas I should consider?

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The only other aspect I can think of is to protect any capital gains, which again I’m nowhere near any taxable thresholds on

6

I would stick with the ISA transfer, sell the US stocks to save the fees if you want. There’s no guarantee the ISA yearly limit won’t be reduced at some point. There’s no ISA fee on T212 and Freetrade will refund any monthly charges after you’ve requested a transfer.

I started off with everything in a General Investment account at first as I was nowhere near dividend or CGT limits, with hindsight I regret not having everything in ISA from the start.

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