My husband sadly died earlier this year, leaving everything to me. He had an investment portfolio held in ISAs in his name and I also have some in my name. My son, who is the executor, is helping me sort out transferring things over but we don’t know what to do about the ISAs. Can we just change the name on the accounts?

Lowestoft Journal: Richard Barker, chartered financial planner with Smith & PinchingRichard Barker, chartered financial planner with Smith & Pinching (Image: Smith & Pinching)

Richard Barker of Smith & Pinching responds:

You will need to notify the ISA providers that your husband has passed away. They will then put his ISAs into what is known as a continuing account for a deceased investor. The assets can then continue to benefit from tax-free growth until they have been dealt with by the executors or administrators or both. Then you may be able to transfer them into an ISA in your name, subject to the relevant ISA allowance.

The amount you can put into an ISA in the tax year is limited by the ISA allowance, which currently stands at £20,000. However, there’s a special dispensation for married couples (or civil partners) who leave their ISAs to each other on death, known as the Additional Permitted Subscription (APS). This takes the form of an additional one-off annual ISA allowance to the value of your husband’s ISA holdings either on his death or when the 'continuing account' is closed, whichever is the greater. The APS is in addition to your normal ISA allowance.

You’ll need to contact each of your husband’s ISA providers to claim the APS. The easiest route may be to open a new ISA in your name with the provider and then transfer the funds across from the continuing account, although you may be able to transfer the funds to an existing ISA in your name if the provider’s rules permit this. You can move the funds later if you decide that you’d prefer to use a different provider.

With Stocks & Shares ISAs, you have two options: you can either sell the investments and then open a new ISA account with the proceeds (using the APS) or you can transfer the entire portfolio in its current format to a new account with the existing provider. The latter route is known as an in specie transfer.

It may be helpful to take independent financial advice at this point to ensure that you secure the APS, carry out any transfers within the permitted time limits and – importantly – invest your inheritance in a way that is suitable for you.

Any opinions expressed in this article do not constitute advice. The value of an investment and the income from it could go down as well as up. The return at the end of the investment period is not guaranteed and you may get back less than you originally invested.

For more information, please visit www.smith-pinching.co.uk