The Individual Savings Account Regulations 1998

General conditions for accounts and subscriptions to accounts U.K.

4.—(1) An account is a scheme of investment, to which an individual who is a qualifying individual may subscribe, and in respect of which the following conditions must be fulfilled—

[F1 (a) the account is set up as a stocks and shares account or a cash account;]

[F1 (b) a stocks and shares account is made up of a single stocks and shares component only;]

[F1 (c) a cash account is made up of a single cash component only;]

[F1 (d) a qualifying individual who is 16 years of age or over may only subscribe to a single cash account in a particular year,]

[F1 (e) a qualifying individual who is 18 years of age or over may only subscribe to a single stocks and shares account in a particular year;]

[F1 (f) it is an account to which only one qualifying individual subscribes;]

[F1 (g) subject to regulation 7(2)(h), it is an account to which the qualifying individual subscribes only by payment to the account manager of a sum or sums of the individual’s cash; and]

[F1 (h) the subscriptions made by the qualifying individual to accounts (ignoring transfers and payments from account managers to the individual) do not in the aggregate in any year exceed the subscription limits in paragraphs (2) and (3).]

[F2 (2) The overall subscription limit for any qualifying investor for any year (that is, the aggregate of the investor’s subscriptions to all accounts in that year) is [F3 £10,200] [F4 unless]—

[F5 (a) the qualifying investor is 50 years of age or over, or is due to be aged 50 not later than 5^th April 2010, where it is £10,200, or]

(b) the qualifying investor is 16 years of age or over but less than 18 years at the end of the year, where it is [F6 £5,100].]

[F2 (3) Within and subject to that overall subscription limit, the qualifying investor may subscribe up to [F7 £5,100] in any year to a cash account[F8 , unless the qualifying investor is 50 years of age or over, or is due to be aged 50 not later than 5^th April 2010, when he or she may invest £5,100 in the year 2009-10.].]

[F2 (4) Accordingly, by way of illustration, the qualifying investor [F9 (who is not aged 50 or over, or due to be aged 50 not later than 5^th April 2010)] may subscribe in a year—

(a) [F10 £5,100] to a cash account and [F10 £5,100] to a stocks and shares account;

(b) £2,000 to a cash account and [F11 £8,200] to a stocks and shares account; or

(c) nil to a cash account and [F12 £10,200] to a stocks and shares account;

but while under the age of 18 years the qualifying investor may only subscribe [F13 £5,100] to a cash account.]

(5) An account must at all times be managed in accordance with these Regulations by an account manager and under terms agreed in a recorded form between the account manager and the account investor.

(6) Apart from other requirements of these Regulations the terms agreed to which paragraph (5) refers shall include the following conditions—

(a) that the account investments shall be in the beneficial ownership of the account investor;

(b) that, except in relation to qualifying investments for a cash component within regulation 8(2)(a), (b) or (e), and subject to regulation 15—

(i) the title to all account investments shall be vested in the account manager or his nominee or jointly in one of them and the account investor, and

(ii) where a share certificate or other document evidencing title to an account investment is issued, it shall be held by the account manager or as he may direct;

(c) that, in relation to a stocks and shares component, and qualifying investments falling within [F14 paragraphs (g), (h), (k), (l) and (m) of regulation 8(2)], the account manager shall, if the account investor so elects, arrange for the account investor to receive a copy of the annual report and accounts issued to investors by every company, unit trust, open-ended investment company or other entity in which he has account investments;

(d) that, in relation to a stocks and shares component, and qualifying investments falling within [F14 paragraphs (g), (h), (k), (l) and (m) of regulation 8(2)], the account manager shall be under an obligation (subject to any provisions made under any enactment and if the account investor so elects) to arrange for the account investor to be able—

(i) to attend any meetings of investors in companies, unit trusts, open-ended investment companies and other entities in which he has account investments,

(ii) to vote, and

(iii) to receive, in addition to the documents referred to in sub-paragraph (c), any other information issued to investors in such companies, unit trusts, open-ended investment companies and other entities;

(e) that the account manager shall satisfy himself that any person to whom he delegates any of his functions or responsibilities under the terms agreed with the account investor is competent to carry out those functions or responsibilities;

(f) that [F15 on the instructions of the account investor (“the transfer instructions”) and within such time as is stipulated by the account investor in the transfer instructions]—

(i) an account, with all rights and obligations of the parties to it, or

(ii) such parts thereof as may be agreed between the account investor and the account manager,

[F16 shall] be transferred to another account manager subject to and in accordance with regulation 21;

[F17 (fa) that on the instructions, subject to regulation 9(3)(b), of the account investor (“the withdrawal instructions”) and within such time as is stipulated by the account investor in the withdrawal instructions, account investments, interest, dividends, rights or other proceeds in respect of such investments or any cash shall be transferred or paid to him;]

(g) that the account manager shall notify the account investor if by reason of any failure to satisfy the provisions of these Regulations an account is or will become no longer exempt from tax by virtue of regulation 22(1).

[F18 (7) The time stipulated in transfer instructions or withdrawal instructions shall be subject to any reasonable business period (not exceeding 30 days) of the account manager required for the practical implementation of the instructions.]

[F19 (8) Where an account holds units in or shares of a UK UCITS, recognised UCITS or non-UCITS retail scheme, and dealings in the units or shares are suspended in accordance with Rule 7.2 of the Collective Investment Schemes Sourcebook (COLL 7.2), or any direct foreign equivalent of that Rule, the business period in paragraph (7) may be extended to 7 days after the end of such suspension.]

Textual Amendments

F1 Reg. 4(1)(a)-(h) substituted (6.4.2008) by The Individual Savings Account (Amendment) Regulations 2007 (S.I. 2007/2119), regs. 1, 5

F2 Reg. 4(2)-(4) substituted (6.4.2008) by The Individual Savings Account (Amendment) Regulations 2007 (S.I. 2007/2119), regs. 1, 6

F3 Sum in reg. 4(2) substituted (6.10.2009 with effect in accordance with reg. 1(4) of the amending S.I.) by The Individual Savings Account (Amendment) Regulations 2009 (S.I. 2009/1550), regs. 1(1), 7(a)

F4 Words in reg. 4(2) inserted (6.10.2009 with effect in accordance with reg. 1(2) of the amending S.I.) by The Individual Savings Account (Amendment) Regulations 2009 (S.I. 2009/1550), regs. 1(1), 3(a)

F5 Reg. 4(2)(a) substituted (temp.) (6.10.2009) by The Individual Savings Account (Amendment) Regulations 2009 (S.I. 2009/1550), regs. 1(1), 3(b)

F6 Sum in reg. 4(2)(b) substituted (6.10.2009 with effect in accordance with reg. 1(4) of the amending S.I.) by The Individual Savings Account (Amendment) Regulations 2009 (S.I. 2009/1550), regs. 1(1), 7(b)

F7 Sum in reg. 4(3) substituted (6.10.2009 with effect in accordance with reg. 1(4) of the amending S.I.) by The Individual Savings Account (Amendment) Regulations 2009 (S.I. 2009/1550), regs. 1(1), 8

F8 Words in reg. 4(3) added (temp.) (6.10.2009) by The Individual Savings Account (Amendment) Regulations 2009 (S.I. 2009/1550), regs. 1(1), 4

F9 Words in reg. 4(4) inserted (temp.) (6.10.2009) by The Individual Savings Account (Amendment) Regulations 2009 (S.I. 2009/1550), regs. 1(1), 5

F10 Sum in reg. 4(4)(a) substituted (6.10.2009 with effect in accordance with reg. 1(4) of the amending S.I.) by The Individual Savings Account (Amendment) Regulations 2009 (S.I. 2009/1550), regs. 1(1), 9(a)

F11 Sum in reg. 4(4)(b) substituted (6.10.2009 with effect in accordance with reg. 1(4) of the amending S.I.) by The Individual Savings Account (Amendment) Regulations 2009 (S.I. 2009/1550), regs. 1(1), 9(b)

F12 Sum in reg. 4(4)(c) substituted (6.10.2009 with effect in accordance with reg. 1(4) of the amending S.I.) by The Individual Savings Account (Amendment) Regulations 2009 (S.I. 2009/1550), regs. 1(1), 9(c)

F13 Sum in reg. 4(4)(c) substituted (6.10.2009 with effect in accordance with reg. 1(4) of the amending S.I.) by The Individual Savings Account (Amendment) Regulations 2009 (S.I. 2009/1550), regs. 1(1), 9(d)

F14 Words in reg. 4(6)(c)(d) substituted (6.4.2008) by The Individual Savings Account (Amendment) Regulations 2008 (S.I. 2008/704), regs. 1, 4

F15 Words in reg. 4(6)(f) substituted (1.10.2002) by The Individual Savings Account (Amendment No. 2) Regulations 2002 (S.I. 2002/1974), regs. 1(2), 3(2)(a)

F16 Word in reg. 4(6)(f) substituted (1.10.2002) by The Individual Savings Account (Amendment No. 2) Regulations 2002 (S.I. 2002/1974), regs. 1(2), 3(2)(b)

F17 Reg. 4(6)(fa) inserted (1.10.2002) by The Individual Savings Account (Amendment No. 2) Regulations 2002 (S.I. 2002/1974), regs. 1(2), 3(3)

F18 Reg. 4(7) inserted (1.10.2002) by The Individual Savings Account (Amendment No. 2) Regulations 2002 (S.I. 2002/1974), regs. 1(2), 3(4)

F19 Reg. 4(8) added (11.8.2009) by The Individual Savings Account (Amendment No. 2) Regulations 2009 (S.I. 2009/1994), regs. 1(1), 4