Citation and commencementU.K.

1.  These Regulations may be cited as the Individual Savings Account Regulations 1998 and shall come into force for the purposes of—

(a)applications under regulations 12 and 13 relating to the year 1999—00, to subscribe to an account in that year,

(b)applications under regulation 14 to be approved as an account manager to manage accounts in the year 1999—00 and subsequent years, and

(c)regulations 16 to 18 and 20, so far as they relate to applications referred to in paragraph (b),

on 1st October 1998, and for all other purposes on 6th April 1999.

InterpretationU.K.

2.—(1) In these Regulations unless the context otherwise requires—

(a)“account", except in the case of—

(i)an account with a deposit-taker, or

F1(ii). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(iii)a share or deposit account with a building society, or

(iv)a deposit account with [F2a person falling within] [F3section 991(2) of the Income Tax Act 2007],

shall be construed in accordance with [F4regulation 4(1) and, where appropriate, regulation 2B(b)] [F5and shall include a personal equity plan treated on and from the 6^th April 2008 as a stocks and shares account];

• an “account investment” is an investment under the account which is a qualifying investment for a stocks and shares component[F6, a cash component[F7, an innovative finance component or a Lifetime ISA component], as the case may be, within the meaning of regulation 7, 8[F8, 8ZA] or 8A];

• [F9an “account investor” has the meaning given in regulation 2A;]

• an “account manager" is a person who fulfils the conditions of these Regulations and is approved by the Board for the purposes of these Regulations as an account manager;

• F10. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• F11. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• “approved profit sharing scheme" has the same meaning as in Chapter IV of Part V of the Taxes Act;

• [F12“article 36H agreement” is to be construed in accordance with article 36H(4) of the Regulated Activities Order 2001 and is an agreement entered into by an account investor as lender with a borrower with the facilitation of an operator and for the purposes of regulation 8A(2) includes such an agreement notwithstanding that, after it is entered into, the operator [F13or, in relation to a continuing account of a deceased investor, any person within the description of section 694A(2) of ITTOIA 2005 or referred to in section 694A(1) of that Act,] assumes the rights of the lender under it;]

• an “assurance undertaking" means [F14a direct life insurance undertaking within the meaning of Article 2 of Directive 2009/138/EC of the European Parliament and of the Council of 25 November 2009 on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II)];

• [F15“bank” has the meaning given by section 991(2) to (5) of the Income Tax Act 2007;]

• [F16“the Board” means the Commissioners for Her Majesty’s Revenue and Customs;]

• [F12“borrower” is to be construed in accordance with article 36H(9) of the Regulated Activities Order 2001;]

• “building society" means a building society within the meaning of the Building Societies Act 1986 M3, or the Irish Building Societies Act 1989 M4;

• [F17“building society bonus”, except in regulation 22(1)(a)(i), excludes any bonus, distribution of funds or the conferring of rights in relation to shares—

  (a)

  in connection with an amalgamation, transfer of engagements or transfer of business of a building society, and

  (b)

  mentioned in section 96 or 100 of the Building Societies Act 1986,

  and “payment under a building society bonus scheme” shall be construed accordingly;.]

• [F18“business day” means any day except—

  (a)

  a Saturday, Sunday, Good Friday or Christmas Day;

  (b)

  a bank holiday under the Banking and Financial Dealings Act 1971;]

• [F19“ceasing to be subject to the plan”, in relation to plan shares under [F20a Schedule 2] SIP, shall be construed in accordance with the SIP code (see section 488(3) of ITEPA 2003);]

• [F21“charity” has the meaning given in paragraph 1(1) of Schedule 6 to the Finance Act 2010;]

• [F22“child” means an individual under 18;]

• [F23“child trust fund” has the meaning given by section 1 of the Child Trust Funds Act 2004;]

• [F24“Child Trust Funds Regulations” means the Child Trust Funds Regulations 2004];

• “company", except in regulation 7(4), means any body corporate having a share capital other than—

  (i)

  an open-ended investment company, within the meaning given by section [F25236 of the Financial Services and Markets Act 2000], [F26or]

  (ii)

  [F27a UK UCITS, recognised UCITS or non-UCITS retail scheme] [F28;]

  (iii)

  F29. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

  (iv)

  F29. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• [F30“continuing account of a deceased investor” has the meaning given in regulation 2G;]

• [F31“credit union” means a society registered as a credit union under the Industrial and Provident Societies Act 1965 or the Credit Unions (Northern Ireland) Order 1985;]

• [F32“CTA 2010” means the Corporation Tax Act 2010;]

• [F24“CTF matured account” has the meaning given in regulation 5DZA;]

• [F33“current year payments” has the meaning given in regulation 10A(3);]

• [F21“debenture” includes any instrument creating or acknowledging indebtedness within the meaning of article 77(1) and (2) of the Regulated Activities Order 2001 but with the omission of the words “such of the following as do not fall within article 78;]

• [F34“deceased’s account” is an account which the deceased held with an account manager at the date of the deceased’s death;]

• “deposit-taker" has the meaning given by [F35section 853 of ITA 2007];

• [F36“the Director of Savings” has the same meaning as in the National Debt Act 1972]

• [F37“dormant account” means an account which contains a “relevant dormant asset” within the meaning given in section 39(2) of the Finance Act 2008, omitting the words “is to be, or”;]

• F38...

• [F39“EEA State” has the meaning given in Schedule 1 to the Interpretation Act 1978;]

• [F40“eligible child” means a child—

  (a)

  born—

  (i)

  on or after 3rd January 2011; or

  (ii)

  before the time mentioned in paragraph (i) but who is not an “eligible child” within the meaning given in the Child Trust Funds Act 2004; and

  (b)

  who, at the time when the application to open an account pursuant to a junior ISA application described in regulation 12A is made, is—

  (i)

  resident F41... in the United Kingdom;

  (ii)

  a person who has general earnings from overseas Crown employment subject to United Kingdom tax within the meaning given by section 28 of ITEPA 2003;

  (iii)

  married to, or in a civil partnership with, a person mentioned in paragraph (ii); or

  (iv)

  a dependant of a person mentioned in paragraph (ii);]

• [F42“eligible conveyancer” has the meaning given in paragraph 7 of the Schedule;]

• [F43“European institution” means a person who is treated as having permission to carry on a regulated activity in the United Kingdom under Part 4A of the Financial Services and Markets Act 2000 by virtue of regulations 8, 11, 28 or 34 of the EEA Passport Rights (Amendment, etc., and Transitional Provisions) (EU Exit) Regulations 2018; ]

• [F44“51% subsidiary” and “75% subsidiary” have the same meanings as they do in section 1154 of CTA 2010;]

• [F45“first subscription”, in any year, means the first subscription into an account in that year which is not a subscription made in accordance with regulation 5D;]

• [F46“flexible account” has the meaning given in regulation 5DDB;]

• “gains", except in regulations 22(1)(a)(ii) to (v) and 35(6), means “chargeable gains"within the meaning of the Taxation of Chargeable Gains Act 1992;

• “gilt-edged securities" has the meaning given by [F47paragraphs 1 and 1A] of Schedule 9 to the Taxation of Chargeable Gains Act 1992;

• [F48“government bonus” has the meaning given in the Schedule;]

• F49. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• an “incorporated friendly society" means a society incorporated under the Friendly Societies Act 1992 M5;

• F50. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• [F12“innovative finance account” has the meaning given in regulation 4(1ZA);]

• [F12“interim permission” is to be construed in accordance with Chapter 4 of Part 8 of the Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2013;]

• [F51“investment trust” means an investment trust within the meaning of section 1158 of the Corporation Tax Act 2010;]

• [F52“ITA 2007” means the Income Tax Act 2007;

• “ITEPA 2003” means the Income Tax (Earnings and Pensions) Act 2003;

• “ITTOIA 2005” means the Income Tax (Trading and Other Income) Act 2005;]

• [F53“junior ISA account” has the meaning given in regulation 2B;]

• F54. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• [F12“lender” is to be construed in accordance with article 36H(9) of the Regulated Activities Order 2001;]

• [F55“Lifetime ISA” has the meaning given in regulation 4(1ZB);]

• [F55“Lifetime ISA payment limit” has the meaning given in regulation 4ZA(1A);]

• [F55“Lifetime ISA qualifying individual” has the meaning given in regulation 10A;]

• [F56“Looked After Child” has the meaning given in regulation 2F (special provision in respect of Looked After Children);]

• “the Management Act" means the Taxes Management Act 1970 M6;

• “market value" shall be construed in accordance with section 272 of the Taxation of Chargeable Gains Act 1992;

• [F57“named child” means a child who holds an account opened pursuant to a junior ISA application described in regulation 12A;]

• “notice", except in [F58regulations 9 and 36], means notice in writing and “notify" shall be construed accordingly;

• [F12“operator” means a person who has permission (other than an interim permission) under Part 4A of FISMA 2000 to carry on the regulated activity specified in article 36H(1) of the Regulated Activities Order 2001;]

• [F59“outstanding principal balance” means, in respect of a qualifying investment for an innovative finance component, the amount in respect of the investment owing to the account investor at any time;]

• [F60“parental responsibility” means—

  (a)

  parental responsibility within the meaning of the Children Act 1989 or the Children (Northern Ireland) Order 1995, or

  (b)

  parental responsibilities within the meaning of the Children (Scotland) Act 1995;]

• [F61“participant”, in relation to [F20a Schedule 2] SIP, shall be construed in accordance with the SIP code (see section 488(3) of ITEPA 2003);

• “plan shares”, in relation to [F20a Schedule 2] SIP, shall be construed in accordance with the SIP code (see section 488(3) of ITEPA 2003) except that—

  (a)

  paragraph 87(6) of Schedule 2 to ITEPA 2003 (meaning of the word “shares” in the context of company reconstructions) shall not apply, and

  (b)

  in paragraph 88(2) of that Schedule (treatment of shares acquired under rights issue) the words “or securities or rights” shall be treated as omitted;]

• [F62“qualifying addition” has the meaning given in the Schedule;]

• “qualifying distribution" has the same meaning as in [F63section 1136 of the Corporation Tax Act 2010];

• [F12“qualifying investments for an innovative finance component” has the meaning given in regulation 8A;]

• “recognised stock exchange" has the same meaning as in [F64section 1005 of ITA 2007] ;

• a “registered friendly society" has the meaning given by the Friendly Societies Act 1992 M7, and includes any society that by virtue of section 96(2) of that Act is to be treated as a registered friendly society;

• [F12“Regulated Activities Order 2001” means the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001;]

• “release date" has the meaning given by section 187(2) of the Taxes Act M8;

• “relevant authorised person" has the same meaning as in [F65section 697(2)(b) of ITTOIA 2005];

• [F66“replacement subscription” has the meaning given in regulation 5DDB;]

• F67. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• [F68“responsible person” means a person who is the responsible person in respect of the management of a junior ISA account in accordance with regulation 2C(4);]

• F69. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• [F70“Schedule 2 SIP” shall be construed in accordance with the SIP code (see section 488(3) of ITEPA 2003);]

• [F71“Schedule 3 SAYE option scheme” shall be construed in accordance with the SAYE code (see section 516(3) of ITEPA 2003);]

• “security", except in regulations [F727(2)(c) to] [F73(cc) and (8)(b), 8(2)(f)] and 34(3), means any loan stock or similar security of a company whether secured or unsecured[F74, and in regulation 7(2)(cc) has the same meaning but with the omission of the words “of a company”];

• [F75“the Stakeholder Products Regulations” means the Financial Services and Markets Act 2000 (Stakeholder Products) Regulations 2004;]

• “tax" where neither income tax nor capital gains tax is specified means either of those taxes;

• “tax credit" means a tax credit under section 231 of the Taxes Act M9;

• “the Taxes Act" means the Income and Corporation Taxes Act 1988;

• [F21“transferable security” has the meaning given in section 102A(3) of FISMA 2000;]

• F76. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• “year" means a year of assessment, and “the year 1999—00" means the year of assessment beginning on 6th April 1999;

(b)

• [F77“authorised fund” means—

  (i)

  an authorised unit trust, or

  (ii)

  an open-ended investment companyF78...;]

• “authorised unit trust" means a unit trust scheme in the case of which an authorisation order F79... under section [F80243 of the Financial Services and Markets Act 2000] is in force;

• F81. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• [F82“collective investment scheme” has the meaning in section 235 of FISMA 2000;]

• [F83“COLL” means the Collective Investment Schemes Sourcebook made by the Financial Conduct Authority under FISMA 2000;]

• [F84“depositary interest” means the rights of the person mentioned in paragraph (b), under a certificate or other record (whether or not in the form of a document) acknowledging—

  (a)

  that a person holds relevant investments or evidence of the right to them, and

  (b)

  that another person is entitled to rights in or in relation to those or identical relevant investments, including the right to receive such investments, or evidence of the right to them or the proceeds from such investments, from the person mentioned in paragraph (a),

• where “relevant investments” means investments which are exclusively qualifying investments for a stocks and shares component falling within any of regulation 7(2)(a) to (h), and the rights mentioned in paragraph (b) are exclusively rights in or in relation to relevant investments;]

• F85. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• F85. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• [F82“FISMA 2000” means the Financial Services and Markets Act 2000;]

• F85. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• [F86“insolvency event” means the procedures listed in the definition of “insolvency event” in [F87regulation 23(18) of the Payment Services Regulations 2017];]

• F85. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• F85. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• [F88“non-UCITS retail scheme”—

  (a)

  has the meaning in COLL (that is, a scheme to which, or to whose authorised fund manager and depositary, sections 5.1, 5.4 and 5.6 of COLL apply),

  (b)

  includes a “recognised scheme” by virtue of section F89... 272 of FISMA 2000, which would fall within paragraph (a) of this definition if it were an authorised fund, and

  (c)

  includes a sub-fund of an umbrella which the terms of the scheme identify as a sub-fund which would fall within paragraph (a) or (b) of this definition if it were itself an authorised fund or a recognised scheme.

  In this definition, expressions defined in the Glossary of the Financial Conduct Authority Handbook have those defined meanings;]

• [F90“open-ended investment company” means a company incorporated in the United Kingdom to which section 236 of the Financial Services and Markets Act 2000 applies;]

• [F91“qualifying units in or shares of a non-UCITS retail scheme” means that—

  (a)

  the instrument constituting the scheme secures that redemption of the units or shares in question shall take place no less frequently than bi-monthly (see Rule 6.2.16(6) of the F92... [F93COLL] omitting the words “Except where (7) applies, and”, read with Rule 6.3.4(1), whether or not those Rules apply to the scheme), and

  (b)

  a provision for suspension of dealings in exceptional conditions in accordance with Rule 7.2 of [F94the COLL] (or any foreign procedure which is a direct foreign equivalent of that Rule) shall not be treated as a provision contrary to paragraph (a) of this definition;]

• [F95“recognised UCITS” means—

  (a)

  a UCITS within the meaning given by section 236A of the Financial Services and Markets Act 2000 which is a recognised scheme for the purposes of Part 17 of that Act; F96...

  (b)

  an undertaking established in Gibraltar which is a UCITS under the law of Gibraltar which implemented Directive 2009/65/EC of the European Parliament and of the Council of 13 July 2009 on the coordination of laws, regulations and administrative provisions relating to undertakings for collective investment in transferable securities;] [F97; or

  (c)

  a recognised scheme in accordance with section 271A of the Financial Services and Markets Act 2000.]

• F98. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• F98. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• F81. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• [F82“UK UCITS” means—

  (a)

  a collective investment scheme [F99with Part 4A permission under FISMA 2000], which complies with the requirements to be a “UCITS scheme” for the purposes of [F100the COLL]; or

  (b)

  a part of a UK UCITS mentioned in paragraph (a) of this definition which would be a sub-fund of an umbrella scheme which is a UK UCITS;]

• [F101“umbrella scheme” means an authorised fund which according to the terms of the scheme is an umbrella scheme belonging to the category under that name established by the [F102Financial Conduct Authority], and

  (i)

  in the case of an authorised fund which is an authorised unit trust, references to a part of an umbrella scheme shall be construed in accordance with subsection (8) of section 468 of the Taxes Act, [F103and sub-paragraphs (6) and (7) of regulation 7 of the Authorised Investment Funds (Tax) Regulations 2006 shall apply for the purposes of these Regulations as they apply for the purposes of those Regulations, and]

  (ii)

  in the case of an authorised fund which is an open-ended investment company, references to a part of an umbrella scheme shall be construed in accordance with [F104subsection (4) of section 468A of the Taxes Act, and sub-paragraphs (2) and (3) of regulation 7 of the Authorised Investment Funds (Tax) Regulations 2006 shall apply for the purposes of these Regulations as they apply for the purposes of those Regulations;]]

• [F105“unit holder” means a person entitled to a share of the investments subject to the trusts of a unit trust scheme;]

• [F105“unit trust scheme” has the meaning given by section 237 of the Financial Services and Markets Act 2000;]

• “units", in relation to an authorised unit trust, means the rights or interests (however described) of the unit holders in that authorised unit trust and, in relation to a part of an umbrella scheme, means the rights or interests for the time being of the unit holders in that part;

• “units in, or shares of, a F106... [F107UK UCITS or recognised] UCITS" means the rights or interests (however described) of the holders of the units or shares in that F106... [F107UK UCITS or recognised] UCITS;

• F108. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[F109(1A) In these Regulations—

(a)a “bulk transfer of accounts” occurs where two or more accounts are transferred by an account manager (“the transferor”) to another account manager (“the transferee”)—

[F110(i)pursuant to an agreement made between the transferor and the transferee where the transfers are not made pursuant to requests made by a person who is the account investor or registered contact in relation to the accounts transferred; or

(ii)pursuant to an insurance business transfer scheme or a banking business transfer scheme under Part 7 (Control of Business Transfers) of the Financial Services and Markets Act 2000;]

(b)a “group transfer of accounts” occurs where a bulk transfer of accounts is made between account managers that are members of the same group of companies when the transfer occurs;

(c)two companies are members of the same group of companies if—

(i)one is a 75% subsidiary of the other, or

(ii)both are 75% subsidiaries of a third company.]

(2) The Table below indexes other definitions in these Regulations:

[F121Meaning of account investorU.K.

2A.—(1) This regulation makes provision for the meaning of “account investor” in these Regulations.

(2) In relation to an account that is not a junior ISA account [F122nor a Lifetime ISA], “account investor” means an individual who subscribes to an account and who is a qualifying individual within the meaning of regulation 10.

(3) In relation to a junior ISA account, “account investor” has different meanings in relation to the application of the regulations specified in paragraphs (4) and (5) as provided for in those paragraphs.

(4) For the purposes of the application of regulations 5C, [F1235D to 5DC, 5DF,] 6(3), 7, 8, 9 (other than regulation 9(3)(b)(iii) and (6)), 21A(1) (other than its first occurrence therein), 21A(2) and (3), 22, 24, 28, 31, 34, 35 (other than regulation 35(10)) and 36, “account investor” means the named child in relation to the account in question.

(5) For the purposes of the application of regulations 4, 9(6), 15, 17, 19, 20, 21A(7), 35(10) and its first occurrence in regulation 21A(1), “account investor” means the registered contact in relation to the account in question.

[F124(6) In relation to a Lifetime ISA, “account investor” means an individual who—

(a)makes, or has made, a qualifying addition to a Lifetime ISA, and

(b)at the time of each qualifying addition by the individual into the Lifetime ISA, is a Lifetime ISA qualifying individual.]

Meaning of junior ISA accountU.K.

2B.  In these Regulations—

(a)an account opened pursuant to a junior ISA application described in regulation 12A is a junior ISA account at any time when it is held by a child;

(b)references to “account” shall be construed as including a reference to an account that is a junior ISA account except where the context otherwise requires; and

(c)references to an account held by a child are references to an account in respect of which the child is the beneficial owner of the account investments under that account.

Meaning of “registered contact” etc.U.K.

2C.—(1) In these Regulations “registered contact” means the person who may give instructions in respect of the management of a junior ISA account to the person who is the account manager in relation to that account.

(2) The person who may give instructions in respect of the management of a junior ISA account to the account manager of that account is—

(a)the named child who holds the account if the application to open the account in accordance with regulation 12A was made by that child,

(b)the named child who holds the account if—

(i)the child has attained the age of 16 years,

(ii)paragraph (3) does not apply in relation to the child, and

(iii)the child has assumed responsibility for the management of the account in accordance with paragraph (6), or

(c)in any other case, the responsible person in relation to the account.

(3) [F125For the purposes of paragraph (2)(b)(ii) this paragraph applies in relation to the child—

(a)if the child is resident in England and Wales and lacks capacity in relation to the management of the junior ISA account under section 2(1) of the Mental Capacity Act 2005;]

(b)[F126if the child is resident in Scotland, the child is suffering mental disorder within the meaning given by] section 328 of the Mental Health (Care and Treatment) (Scotland) Act 2003;

(c)[F127if the child is resident in Northern Ireland, the child is suffering mental disorder within the meaning given by] Article 3 of the Mental Health (Northern Ireland) Order 1986.

(4) A person is the responsible person in relation to a junior ISA account if—

(a)that person—

(i)makes the application to open the account in question in accordance with regulation 12A; or

(ii)assumes responsibility for the management of the account in accordance with paragraph (6); and

(b)that person has parental responsibility in relation to the named child who holds the account at the time when that person—

(i)makes the application described in sub-paragraph (a)(i); or

(ii)assumes responsibility for the management of the account as described in sub-paragraph (a)(ii).

(5) A person ceases to be the person who may give instructions in respect of the management of a junior ISA account to the person who is the account manager in relation to that account when another person assumes responsibility for the management of the account in accordance with paragraph (6).

(6) A person assumes responsibility for the management of a junior ISA account if—

(a)the person makes an application to assume responsibility for the management of the account in accordance with paragraph (7), and

(b)the account manager of the account in question accepts the application.

(7) An application by a person (“the applicant”) to assume responsibility for the management of a junior ISA account must—

(a)be made to the account manager of the account in question;

(b)contain—

(i)the applicant’s full name,

(ii)the applicant’s address (including postcode),

(iii)the named child’s full name and date of birth,

(iv)the named child’s address (including postcode),

(v)the named child’s national insurance number if the child is over 16 and has been issued with a national insurance number, and

(vi)the authorisation specified in paragraph (8);

(c)contain a declaration by the applicant that the applicant—

(i)is 16 years of age or over,

(ii)is the named child who holds the account in question or has parental responsibility in relation to the named child who holds the account in question, and

(iii)is to be the registered contact for the account.

(8) The authorisation specified by this paragraph is authority given by the applicant to the account manager (on behalf of the named child who holds the account where appropriate)—

(a)to hold the subscriptions, account investments, interest, dividends and any other rights or proceeds in respect of those investments and cash;

(b)to make on behalf of the named child any claims to relief from tax in respect of account investments; and

(c)to make a record in writing in accordance with paragraph (11) where that paragraph requires the account manager to do so.

(9) An account manager must not accept an application to assume responsibility for the management of a junior ISA account if—

(a)except in the circumstances specified in paragraph (10), the person who is the registered contact in relation to the account at the time when the application is made does not consent to the applicant assuming responsibility for the management of the account; or

(b)the account manager has reason to believe that the applicant has given untrue information in the application.

(10) The circumstances specified in this paragraph are—

(a)the death of the most recent registered contact,

(b)the incapacity of the registered contact,

(c)where the registered contact cannot be contacted,

(d)the bringing to an end of a Court order under which the registered contact is a responsible person,

(e)where the applicant is the named child who holds the account and is aged 16 or over,

(f)where, under an adoption order, the applicant is the adopter of the named child who holds the account,

(g)where a Court so orders,

(h)where the applicant has been appointed to be a guardian or special guardian of the named child who holds the account.

(11) Where the application to assume responsibility for the management of a junior ISA account is not in writing or the account manager operates a record system under which all original written applications are not retained—

(a)the account manager must, immediately after receiving the application, record, in writing, on behalf of the applicant the declaration required by paragraph (7)(c) and the authorisation required by paragraphs (7)(b)(vi) and (8);

(b)the account manager must notify the applicant of the contents of the written record within 5 business days of making it; and

(c)the written record (as amended by any corrections notified to the account manager by the applicant within 30 days of the notification mentioned in sub-paragraph (b)) shall be treated as the applicant’s declaration required by paragraph (7)(c) and authorisation required by paragraphs (7)(b)(vi) and (8).

Regulations that do not apply to junior ISA accountsU.K.

2D.  Regulations 4(6)(fa), 4ZA, 4A, [F1284AA,] 4B, F129...F130... [F1315DDA,] [F1325DDB,] [F1335DDC,] [F1345DI to 5DM,] 7(2)(h), [F1358ZA, 8A, 10 to 12, 12B,] 21F129... and 30, do not apply to a junior ISA account.

Contracts entered into by or on behalf of a child who is 16 or overU.K.

2E.  Where, by virtue of the opening of an account pursuant to a junior ISA application described in regulation 12A, a contract is entered into by a child who is—

(a)aged 16 or over; and

(b)the child who—

(i)holds the account, or

(ii)has parental responsibility in relation to the child who holds the account,

the contract has effect as if the child who opened the account had been 18 or over when the contract was entered into.]

[F136Special provision in respect of Looked After ChildrenU.K.

2F.—(1) A child is a Looked After Child where, after 2nd January 2011, there is a continuous period of at least 12 months during which paragraph (2) applies in relation to the child.

(2) This paragraph applies in relation to a child where the child is—

(a)looked after by a local authority within the meaning of section 22(1) of the Children Act 1989 (general duty of local authority in relation to children looked after by them);

[F137(ab)looked after by a local authority within the meaning of section 74 of the Social Services and Well-being (Wales) Act 2014;]

(b)provided with accommodation by an authority by virtue of article 21 of the Children (Northern Ireland) Order 1995 (provision of accommodation for children: general);

(c)the subject of an order made under article 50(1)(a) of the Children (Northern Ireland) Order 1995 (care orders and supervision orders);

(d)provided with accommodation by a local authority by virtue of section 25 of the Children (Scotland) Act 1995 (provision of accommodation for children, etc.);

(e)the subject of a supervision requirement made under section 70(1) of the Children (Scotland) Act 1995 (disposal of referral by children’s hearing: supervision requirements, including residence in secure accommodation);

[F138(ea)the subject of a compulsory supervision order within section 83 of the Children’s Hearings (Scotland) Act 2011 (“the 2011 Act”) (meaning of compulsory supervision order);

(eb)the subject of an interim compulsory supervision order within section 86 of the 2011 Act (meaning of interim compulsory supervision order);]

(f)the subject of a permanence order made under section 80 of the Adoption and Children (Scotland) Act 2007 (permanence orders); or

(g)treated as if the child were subject to an order described in sub-paragraph (f) by virtue of article 13(1) of the Adoption and Children (Scotland) Act 2007 (Commencement No. 4, Transitional and Savings) Order 2009.

(3) In relation to a Looked After Child, regulations 2C(4)(b) (meaning of “registered contact” etc.) and 12A(4)(b)(i) (conditions for application to open an account that is a junior ISA account) must be construed as if the Share Foundation has parental responsibility in respect of that child.

(4) In relation to an application to assume responsibility for the management of a junior ISA account by the Share Foundation, regulation 2C(7)(c) must be construed as requiring a declaration that—

(a)the applicant is the Share Foundation;

(b)the application is in relation to a Looked After Child; and

(c)the Share Foundation is to be the registered contact for the account.

(5) Where an application to assume responsibility for the management of a junior ISA account is made in relation to which the registered contact is the Share Foundation, regulation 2C(9)(a) must be construed as referring only to sub-paragraphs (e) and (g) of paragraph (10).

(6) Where the registered contact in relation to a junior ISA account is the Share Foundation, any reference in these Regulations to the residence of the registered contact must be construed as meaning a reference to the registered offices of the Share Foundation.

(7) In this regulation “the Share Foundation” means the company limited by guarantee (number 4500923) and charity registered with the Charity Commission of England and Wales (number 1108068) as “The Share Foundation”.]

[F139Continuing account of a deceased investor and administration-period investmentsU.K.

2G.—(1) This regulation applies to an account, other than a junior ISA account, when the account investor has died (“continuing account of a deceased investor”).

(2) Investments held in such an account are to be administration–period investments as a result of section 694A(4) or (5) of ITTOIA 2005 for the period beginning on the death of the account investor and ending on the earlier of—

(a)the completion of the administration of the deceased’s estate,

(b)the day falling on the third anniversary of the death, or

(c)the closure of the account within the meaning of regulation 4B(3)(a).

(3) A continuing account of a deceased investor is to cease to be such an account at the end of the period referred to in paragraph (2).

(4) Notwithstanding any other provision of these Regulations—

(a)no subscription or qualifying addition is to be made to a continuing account of a deceased investor, and

(b)no transfer is to be made of a continuing account of a deceased investor otherwise than a transfer when regulation 17, 19 or 20 applies.

(5) In relation to a continuing account of a deceased investor, wherever the following expressions occur in these Regulations—

(a)“investments”, “account investments”, “qualifying investments”, “investments under an account”, or any other description of an account investment, includes administration-period investments,

(b)“account investor”, “applicant”, or any other description of an account investor, includes any person within the description of section 694A(2) of ITTOIA 2005 and, in the case of regulations 22 and 36(3), also any person referred to in section 694A(1) of that Act, and

(c)“account”, “Lifetime ISA”, or any reference to a scheme of investment, includes a continuing account of a deceased investor, notwithstanding that no subscription or qualifying addition can be made to it.

(6) In relation to a continuing account of a deceased investor—

(a)regulations 4(6)(a) and (f) (except in relation to a transfer when regulation 17, 19 or 20 applies), 12(3)(f) and (6)(a) and 12B(8)(a) and (c) do not apply,

(b)in regulation 7(2)(h)(iii), the phrase “but have remained in the beneficial ownership of the participant” is to be treated as omitted, [F140and]

(c)in regulation 21(4D), after “made on a transfer”, there is to be treated as inserted “and is a continuing account of a deceased investor”. F141...

F141(d). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .]

IntroductoryU.K.

3.  These Regulations provide for the setting up of plans in the form of an account, by account managers approved by the Board, under which individuals may make certain investments, for the conditions under which they may invest and under which those accounts are to operate, for relief from tax in respect of account investments and generally for the administration of tax in relation to such accounts.

General conditions for accounts and subscriptions to accountsU.K.

4.—[F142(1) An account is a scheme of investment, to which a subscription may be made, [F143which is an innovative finance account [F144or a Lifetime ISA] or in respect of which—]

(a)the conditions and requirements contained in paragraphs (1A) and (5) to (8) are fulfilled; and

(b)either—

(i)the conditions contained in paragraph (1B) are fulfilled, or

(ii)at the time when the subscription to the account is made, the account is a junior ISA account.]

[F145(1ZA) An innovative finance account is an account in respect of which—

(a)the conditions in paragraphs (1A)(a) and (ca); [F146(1B)(ba) and (c), d(i) and (e)]; (5); (6)(a), (e) and (g) are fulfilled;

(b)in relation to cash held in an account, the conditions in paragraphs (6)(f) and (fa) and (7) are fulfilled; and

(c)the application to open the account is made in accordance with regulation 12.]

[F147(1ZB) A Lifetime ISA is an account in respect of which—

(a)the conditions in paragraphs (1A)(a) and (cb), (1B)(bb), (c), (d)(ii), (e) and (f) and (5) to (10) are fulfilled; and

(b)the application to open the account is made in accordance with regulation 12B.]

[F148(1A) The conditions in this paragraph are—

(a)the account is set up as a stocks and shares account[F149, a cash account[F150, an innovative finance account or a Lifetime ISA]];

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

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

[F151(ca)an innovative finance account is made up of a single innovative finance component only;]

[F152(cb)a Lifetime ISA is made up of a single Lifetime ISA component only;]

(d)the application to open the account is made in accordance with regulation 12 or 12A.

(1B) The conditions in this paragraph are—

(a)[F153except for a subscription made in accordance with regulation 5D(2)(a)(i),(iv) or (v),] a qualifying individual who is 16 or over may only subscribe to a single cash account that is not a junior ISA account in a particular year;

(b)[F154except for a subscription made in accordance with regulation 5D(2)(a)(iv),] a qualifying individual who is 18 or over may only subscribe to a single stocks and shares account that is not a junior ISA account in a particular year;

[F155(ba)except for a subscription made in accordance with regulation 5D(2)(a)(iv), a qualifying individual who is 18 or over may only subscribe to a single innovative finance account in a particular year;]

[F156(bb)a Lifetime ISA qualifying individual may only make a qualifying addition to a single Lifetime ISA in a particular year;]

(c)it is an account to which only one qualifying individual subscribes [F157or, in the case of a Lifetime ISA, to which only one Lifetime ISA qualifying individual makes a qualifying addition];

[F158(d)subject to regulations 5DDA(2)(e) and 7(2)(h), it is—

(i)an account that is not a Lifetime ISA account to which the qualifying individual subscribes only by payment to the account manager of a sum or sums of the individual’s cash, or

(ii)a Lifetime ISA to which the Lifetime ISA qualifying individual makes qualifying additions only by—

(aa)payment to the account manager of a sum or sums of the individual’s cash; or

(bb)a transfer of qualifying investments for a Lifetime ISA component from another account of the account investor;]

(e)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 [F159limit] in regulation 4ZA(1) F160... ][F161; and

(f)in the case of a Lifetime ISA the current year payments made by a Lifetime ISA qualifying individual do not in aggregate in any year exceed the Lifetime ISA payment limit in regulation 4ZA(1A).]

F162(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F162(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F163(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(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 [F164secure]—

[F165(a)that the account investments shall be in the beneficial ownership of—

(i)in the case of an account that is not a junior ISA account, the account investor; or

(ii)in the case of a junior ISA account, the named child;]

(b)that, except in relation to qualifying investments for a cash component within regulation 8(2)(a), (b) or (e) [F166and qualifying investments for an innovative finance component], and subject to regulation 15—

(i)[F167in relation to an account that is not a junior ISA account,] 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,

[F168(ia)in relation to an account that is a junior ISA account, title to all investments shall be vested in the account manager or his nominee or jointly in one of them and either one of the registered contact or named child to the account in question as the account manager considers appropriate,] 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, [F169qualifying investments for an innovative finance component][F170, a Lifetime ISA component] [F171and qualifying investments falling within sub-paragraph (h) 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, [F172qualifying investments for an innovative finance component][F173, a Lifetime ISA component] [F174and qualifying investments falling within sub-paragraph (h) 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 [F175on 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,

[F176shall] be transferred to another account manager subject to and in accordance with [F177regulation 21 or 21B] [F178and, where it applies, regulation 21A];

[F179(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 [F180or, where paragraph 6(12) of the Schedule applies, an eligible conveyancer];]

(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).

[F181(7) The time stipulated in the transfer instructions or withdrawal instructions shall be subject to any reasonable business period of the account manager required for the practical implementation of the instructions, but such period—

(a)must not exceed 30 days; and

(b)must be consistent with regulation 21A where it applies.]

[F182Where the account is a Lifetime ISA and an amount is being withdrawn for the purpose of a first-time residential purchase by the account investor under paragraph 6 of the Schedule, the period of 30 days referred to in sub-paragraph (a) runs from the date on which the account manager receives the information from the account investor’s conveyancer in accordance with paragraph 8(2) and (3) of the Schedule.]

[F183(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 [F184COLL], 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.]

[F185(9) A Lifetime ISA opened in accordance with regulation 12B is to be treated as such an account notwithstanding that the account investor reaches 50 years of age or over and that no further qualifying addition can be made to the account.

(10) A Lifetime ISA in relation to which an account manager has received notification of closure within 30 days after the latest applicable cancellation period start date for the purposes of the Conduct of Business Sourcebook (published by the Financial Conduct Authority under FISMA 2000) is to be treated for all purposes of these Regulations as never having been such an account.

(11) Where a Lifetime ISA is opened (“the new account”) on a transfer from another such account (“the original account”) of the account investor, the latest applicable cancellation period start date for the original account is to be treated for the purposes of paragraph (10) as the latest applicable cancellation start date for the new account.

(12) If during the year 2017-18 after the opening of a Lifetime ISA a withdrawal is made other than in any of the circumstances specified in paragraph (13) or described in paragraph 11 of the Schedule the account is to be treated for all purposes of these Regulations as never having been such an account.

(13) The circumstances specified in this paragraph are where—

(a)the withdrawal is by way of a transfer to another Lifetime ISA in accordance with regulation 21;

(b)the account investor is suffering from a terminal illness (within the meaning of paragraph 4(2) of the Schedule); or

(c)the withdrawal is made at a time after the account investor’s death.]

[F186Subscriptions to an account other than a junior ISA accountU.K.

4ZA.—(1) The overall subscription limit for any qualifying individual for any year (that is the aggregate of the qualifying individual’s subscriptions to all accounts that are not junior ISA accounts in that year) is [F187£20,000].

F188(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F188(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[F189(1A) The overall Lifetime ISA payment limit in respect of current year payments for any Lifetime ISA qualifying individual for any year is £4,000.]

F190(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) A qualifying individual may not subscribe to an account that was a junior ISA account while it was held by the qualifying individual as the named child for the account unless the account manager of that account has been provided with—

(a)the qualifying individual’s national insurance information specified by paragraph (4);

(b)a declaration specified by paragraph (5);

(c)the authorisation specified by paragraph (6); and

(d)if the account manager of the account requires, an authorisation specified by paragraph (7).

(4) The national insurance information specified by this paragraph is—

(a)the qualifying individual’s national insurance number; or

(b)a declaration by the qualifying individual that the qualifying individual does not have a national insurance number.

(5) The declaration specified by this paragraph is a declaration by the qualifying individual that, if the qualifying individual were making an application to open an account pursuant to regulation 12, would be in accordance with paragraph (3)(c) to (f) of that regulation.

(6) The authorisation specified by this paragraph is an authorisation by the qualifying individual that, if the qualifying individual were making an application to open an account pursuant to regulation 12, would be in accordance with paragraphs (4)(e) and (4A)(c) of that regulation.

(7) The authorisation specified by this paragraph is an authorisation by the qualifying individual that, if the qualifying individual were making an application to open an account pursuant to regulation 12, would be in accordance with paragraphs (4)(e) and (4A)(a) and (b) of that regulation.

(8) Regulation 12(7), (9) and (10) apply in relation to the declaration specified by paragraph (5) and authorisations specified by paragraphs (6) and (7) as if they were made in relation to an application made by the qualifying individual to open an account pursuant to regulation 12.

(9) For the purposes of paragraphs (5) to (8)—

(a)references in regulation 12 to “the applicant” are references to the qualifying individual making the declaration specified by paragraph (5) or giving an authorisation specified in paragraphs (6) and (7);

(b)references in regulation 12(3)(c) to (f) to “the year in which paragraph (2) refers” (the first year to which the application to open the account relates) are references to the year in which the declaration specified by paragraph (5) is made by the qualifying individual.

Subscriptions to a junior ISA accountU.K.

4ZB.—(1) Any person may subscribe to a junior ISA account provided the overall amount subscribed by that person and any other person for any year in respect of the same named child does not exceed [F191£9,000].

(2) An amount paid to a junior ISA account in excess of the amount mentioned in paragraph (1) is not an amount subscribed to a junior ISA account and must not be held in that account.

(3) A single subscription for an amount equal to the amount mentioned in paragraph (1) or any number of smaller amounts that, when aggregated, do not exceed the amount mentioned in paragraph (1), may be made in respect of the same named child—

(a)to a cash account held by that child,

(b)to a stocks and shares account held by that child, or

(c)in any proportion between such accounts.

(4) No subscription may be made to a cash account that is a junior ISA account held by a named child where—

(a)the balance in the account is less than one penny; and

(b)that child holds another cash account opened pursuant to a junior ISA application described in regulation 12A after the time when the account mentioned in sub-paragraph (a) was opened.

(5) No subscription may be made to a stocks and shares account that is a junior ISA account held by a named child where—

(a)the balance in the account is less than one penny; and

(b)that child holds another stocks and shares account opened pursuant to a junior ISA application described in regulation 12A after the time when the account mentioned in sub-paragraph (a) was opened.

Inalienability of a junior ISA accountU.K.

4ZC.—(1) Any assignment of, or agreement to assign, investments under a junior ISA account, and any charge on or agreement to charge any such investments, is void.

(2) On the bankruptcy of the named child holding a junior ISA account, the entitlement to investments under it does not pass to any trustee or other person acting on behalf of the child’s creditors.

(3) “Assignment” includes assignation; and “assign” is to be construed accordingly.

(4) “Charge on or agreement to charge” includes a right in security over or an agreement to create a right in security over.

(5) “Bankruptcy”, in relation to a named child, includes the sequestration of the child’s estate.

(6) Paragraph (1) shall not render void anything done to vest title to an account investment as required by regulation 4(6)(b)(ia) or 15(a) by virtue of—

(a)a transfer of an account in accordance with regulation 21B; or

(b)a change of registered contact in relation to a junior ISA account.

Permitted withdrawals from a junior ISA accountU.K.

4ZD.  Withdrawals from a junior ISA account may only be made—

(a)by the account manager, to settle any management charges and other incidental expenses, which are due by or under the management agreement,

(b)in accordance with regulation 4ZE, or

(c)where the account manager is satisfied that the named child who held the account has died.

Permitted withdrawals from a junior ISA account where the named child is terminally illU.K.

4ZE.—(1) A registered contact may make a claim to the Board for withdrawals from a junior ISA account to be permitted in accordance with this regulation.

(2) The claim shall be—

(a)made in a manner prescribed by the Board, which shall include the giving of any consent necessary for the verification or consideration of the claim, and

(b)accepted in either of the following cases:

• [F192Case 1

  The named child holding the account:

  (i)

  in England and Wales F193..., falls within either section 72(5) of the Social Security Contributions and Benefits Act 1992 (special rules for terminally ill person’s entitlement to care component of disability living allowance) or section 82(4) of the Welfare Reform Act 2012 (terminal illness); F194...

  (ii)

  in Northern Ireland, falls within section 72(5) of the Social Security Contributions and Benefits (Northern Ireland) Act 1992 (the care component)] [F195and, for this purpose, section 66(2)(a) of that Act (attendance allowance for the terminally ill) is deemed to apply as if for “6 months” there were substituted “12 months”] [F196, or

  (iii)

  in Scotland, falls within either of the provisions mentioned in paragraph (i), or is to be regarded as having a terminal illness in accordance with regulations for disability assistance for children and young people [F197, or regulations for disability assistance for working age people,] made under section 31 of the Social Security (Scotland) Act 2018.]

• Case 2

  Evidence that the named child holding the account is terminally ill has been supplied to the satisfaction of the Board.

(3) The Board shall issue a letter to the registered contact authorising withdrawals from the account under this regulation F198....

(4) Once a claim has been accepted, withdrawals of any amount (including the proceeds from a policy of life insurance and an amount sufficient to close the account) may be made by the registered contact at any time (but this does not include the transfer of a policy of life insurance otherwise than in accordance with regulation 21B).

(5) Where account investments are withdrawn in a form other than sterling currency, the named child shall be treated as having sold the account investments in question, and as having reacquired them in his personal capacity, for a consideration equal to their market value at the time of their withdrawal.

(6) In this regulation, “terminally ill” has the meaning—

(a)[F199 for England and Wales F200...] in section 66(2)(a) of the Social Security Contributions and Benefits Act 1992 [F201or section 82(4) of the Welfare Reform Act 2012 (terminal illness); F202...

(b)for Northern Ireland, section 72(5) of the Social Security Contributions and Benefits (Northern Ireland) Act 1992 (the care component)] [F203[F204and, for this purpose, section 66(2)(a) of that Act (attendance allowance for the terminally ill) is deemed to apply as if for “6 months” there were substituted “12 months”], or

(c)for Scotland, in either of the provisions mentioned in sub-paragraph (a), or as set out in regulations for disability assistance for children and young people [F205, or regulations for disability assistance for working age people,] made under section 31 of the Social Security (Scotland) Act 2018.]]

[F206[F207Repair of certain incompatible account and excess subscriptions - accounts other than junior ISA accounts]U.K.

4A.—(1) An invalid account is “eligible for repair” if, in relation to the year in which the subscriptions to the account were made (“the relevant year”), it satisfies—

[F208(a)both the First and Second Conditions below, or

(b)the Third Condition.

• First Condition

  The account is invalid because a subscription to the account causes the account investor to breach the conditions in [F209regulation 4(1B)(a)[F210, (b) or (ba)]] (which, taken together, allow an individual to subscribe to a single cash account[F211, a single stocks and shares account and a single innovative finance account], in a particular year) and for no other reason.

• Second Condition

  The account is (disregarding any account exempt from tax under regulation 4B) the earliest account in the relevant year, the subscriptions to which caused the account investor to breach the conditions in [F209regulation 4(1B)(a)[F212, (b) or (ba)]], as the case may be (that is, it was first subscribed to earlier in that year than any other such account).

• Third Condition

  The account is invalid because a subscription to the account breaches the overall subscription limit in [F213regulation [F2144ZA(1)]], and for no other reason.]

(2) In this regulation—

(a)where an account investor subscribes to a particular account in more than one year, each year’s subscriptions shall be treated as a separate account for the purposes of this regulation, and regulation 4B (except for determining when an account is closed) only;

(b)“date of discovery” means the date on which an officer of the Board gives a notice (“notice of discovery”) to the account manager or account investor that the account is invalid, and (if appropriate) directions under paragraph (5) below;

F215(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(d)“valid account” means an account which (apart from under this regulation) is exempt from tax under regulation 22(I);

(e)“invalid account” means a scheme of investment which is not exempt from tax under these Regulations but which (if so exempt) would be an account, within the meaning in [F216regulation 4(1A)(a)] and, in relation to an invalid account, references to an account [F217and component] have corresponding meanings; and

(f)(for the avoidance of doubt) “repair” of an account is without prejudice to loss of, and accounting to the Board for, any relief from tax given for the period up to the date of discovery.

(3) An invalid account which is eligible for repair shall be treated as—

(a)exempt from tax under this regulation (as if under regulation 22), and

(b)complying with the conditions of regulation [F218regulation 4(1B)(a)[F219, (b) or (ba)], or 4ZA(1) F220... ], as the case may be,

as from the date of discovery, to the extent of the relevant proportion mentioned in paragraph (4)(b).

(4) [F221(a) Calculate the extent to which the subscriptions made (and counting towards the subscription [F222limit]) during the relevant year—

(i)to that account, any other account which is eligible for repair, and any valid account (but ignoring subscriptions to any closed account within the meaning in regulation 4B)) do not exceed,

(ii)the subscriptions [F223limit] in [F224regulation 4ZA(1)]F225... , and]

(b)an officer of the Board shall apportion that result between the accounts mentioned in sub-paragraph (a)(i), and the amount apportioned to the account mentioned in paragraph (3) is the relevant proportion.

(5) The account manager must comply within 30 days with any directions in the notice of discovery which—

(a)make the apportionment under paragraph (4)(b) and identify the account and component from which excess subscriptions or allocations (if any) are to be removed;

(b)direct the removal of subscriptions and proceeds representing them from an account; or

(c)direct the removal of subscriptions and proceeds representing them from a component.

[F226(6) For the purposes of this regulation, a subscription to an account that is a junior ISA account shall be disregarded.]

[F227(7) This regulation is subject to regulation 4AA.]]

[F228Application of the repair provisions to Lifetime ISAsU.K.

4AA.—(1) The following modifications to regulation 4A apply where one or more of the accounts to which the investor subscribes in the relevant year is a Lifetime ISA.

(2) Where an investor has made current year payments in excess of the Lifetime ISA payment limit in regulation 4ZA(1A) to a single Lifetime ISA, an officer of the Board may direct the removal of the excess and proceeds representing the excess, whether or not the overall subscription limit in regulation 4ZA(1) has been exceeded.

(3) Where an investor has exceeded the overall subscription limit in regulation 4ZA(1), but has not exceeded the Lifetime ISA payment limit in regulation 4ZA(1A), the excess shall be removed from the accounts which are not Lifetime ISAs.

(4) Where an investor has made current year payments or a payment described in regulation 10A(4)(c) to more than one Lifetime ISA, only one account will be a valid account which is eligible for the payment of a government bonus.]

[F229Closure of [F230cash] account [F231that is not a junior ISA account] prior to the opening of the same type of account to be disregarded onceU.K.

4B.—(1) Where—

(a)an account investor, within the same year—

(i)subscribes to a [F232cash] account,

(ii)then closes it (“the closed account”), and

(iii)subsequently first subscribes to another [F233cash account], and

(b)the closed account was (apart from under this regulation) exempt from tax under regulation 22(1),

the earliest account in that year to fall within the terms of sub-paragraph (a)(iii) (the “first later account”) shall be eligible for the relief in paragraph (2).

(2) The first later account shall be treated, as from the date of the first subscription to it mentioned in paragraph (1)(a)(iii) [F234as complying with the conditions of [F235regulation 4(1B)(a)]] in the same manner as the closed account.

(3) In this regulation, an account is closed where—

(a)the account investor withdraws from the account all account investments, other proceeds in respect of such investments and cash, representing subscriptions to the account (and closure shall be treated as occurring at the date of such withdrawal), and

(b)no further subscriptions to the account are made during the remainder of the year, after such withdrawal.

[F236(4) This regulation does not apply to a subscription to an account made in accordance with regulation 5D.]]

Removal of insurance components at 6th April 2005U.K.

F2374C.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Removal of maxi-accounts, mini-accounts and TESSA only accounts at 6^th April 2008U.K.

F2384D.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Treatment of sums held in accounts managed by Icesave BankU.K.

F2395A.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Treatment of certain sums held in accounts managed by Keydata Investment Services LimitedU.K.

F2405B.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[F241Treatment of certain sums held in dormant accountsU.K.

5C.—(1) Regulations 30 and 31 (information by account managers) shall not apply to a dormant account, while section 1 or 2 of the Dormant Bank and Building Society Accounts Act 2008 (“the 2008 Act”) [F242or sections 2, 5, 8, 12 or 14 of the Dormant Assets Act 2022] applies in relation to that account.

(2) Where, following a repayment claim, the balance of a dormant account is paid—

(a)back into the account (in a case where the original F243... account can be reinstated with the same account manager, the same account investor and number), or

(b)into another F244... account in the same account investor’s name F245... (in any other case),

the payment into the account shall not count towards the subscription [F246limit] in [F247regulation 4ZA(1)].

(3) In this regulation, “repayment claim” means a repayment claim mentioned in section 5(6) of the 2008 Act, and other terms used in this regulation and that Act have the same meaning in this regulation as in that Act.]

[F248Subscriptions disregarded for the purposes of the subscription limits in regulations [F2494ZA(1)] and 4ZBU.K.

5D.—(1) A subscription to an account made in accordance with this regulation must be disregarded for the purposes of the subscription limits in regulations [F2504ZA(1)] (subscriptions to an account other than a junior ISA account) and 4ZB (subscriptions to a junior ISA account).

(2) A subscription to an account held by an account investor is made in accordance with this regulation if—

(a)the subscription is—

(i)a defaulted cash account subscription;

[F251(ia)a defaulted Lifetime ISA subscription;

(ib)a returned withdrawal from a Lifetime ISA following failure of a purchase to complete under paragraph 10(1) of the Schedule;]

(ii)a defaulted investment subscription; F252...

[F253(iia)a replacement subscription;]

(iii)permitted in accordance with regulation 5DE; F254...

[F255(iv)permitted in accordance with regulation 5DDA; [F256or]]

[F257(v)permitted in accordance with regulation 5DDC; and]

(b)the account manager of the account to which the subscription is made is provided with the information specified in regulation 5DF as relevant to the subscription[F258;] [F259and

(c)in a case within sub-paragraph (a)(iv)—

(i)the account manager of the account to which the subscription is made is provided with the declarations required by regulation 5DFA as relevant to the subscription;

(ii)the notices specified in regulation 5DFB(1) and (3) are given, as relevant to the subscription; and

(iii)the information and declarations required by regulation 5DFC(2) are

provided][F260; and

(d)in a case within paragraph (2)(a)(ib) the account manager of the Lifetime ISA to which the subscription is made is provided with the information specified in paragraph 9(3)(b) of the Schedule.]

[F261(3) A subscription to an account held by an account investor is made in accordance with this regulation if it comprises a transfer provided for by regulation 20A of the Child Trust Funds Regulations 2004.]

[F262Treatment of ISA where funds transferred under regulation 13A of the Child Trust Funds Regulations (maturity of child trust fund - instructions)U.K.

5DZ.—(1) This regulation applies where a qualifying individual has given an instruction under regulation 13A of the Child Trust Funds Regulations that investments be transferred by way of subscription to an account under these regulations.

(2) A subscription made in accordance with this regulation must be disregarded for the purposes of—

(a)the overall subscription limit under regulation 4ZA(1) (subscriptions to an account other than a junior ISA account); and

(b)the conditions under regulations—

(i)10(2)(b) to (d) (qualifying individuals who may invest under an account that is not a junior ISA account nor a Lifetime ISA);

(ii)10A(2)(f) (Lifetime ISA qualifying individuals who may invest under a Lifetime ISA); and

(iii)12B(4)(d)(i) to (iii) (conditions for application to open an account that is a Lifetime ISA).

(3) Where a qualifying individual has given an instruction in relation to funds held otherwise than in cash, such transfer may be made in specie.

Treatment of ISA where funds transferred under regulation 13B(2)(b) of the Child Trust Funds Regulations (maturity of child trust fund - no instructions)U.K.

5DZA.—(1) This regulation applies where a transfer is made under regulation 13B(2)(b) of the Child Trust Funds Regulations to a cash account or a stocks and shares account (“a CTF matured account”).

(2) A transfer under that regulation is to be disregarded for the purposes of—

(a)the overall subscription limit under regulation 4ZA(1) (subscriptions to an account other than a junior ISA account), and

(b)the conditions for a qualifying individual under regulation 10(2)(b) to (d) (qualifying individuals who may invest under an account that is not a junior ISA account nor a Lifetime ISA).

(3) Notwithstanding any other provision of these regulations, paragraphs (4) to (10) apply until the account holder makes an application under regulation 12 (conditions for application to open an account that is not a junior ISA account or a Lifetime ISA).

(4) The CTF matured account is to be held in the name of the account holder of the matured child trust fund to which the transfer relates in accordance with regulation 13B(2)(b) of the Child Trust Funds Regulations.

(5) The account holder is to be treated as an account investor.

(6) No further subscription may be made to the CTF matured account.

(7) Amounts in respect of investments on the CTF matured account are to be credited to it.

(8) In relation to a CTF matured account, regulation 31(1) (returns of information by account manager) is to be treated as omitted and paragraph (9) is to apply instead.

(9) This paragraph applies for the purposes of paragraph (8).

(a)An account manager must within 60 days after the end of each year (beginning the year 2020-21) deliver to the Board a return for that year which contains the information as at the 5th April in that year specified in sub-paragraphs (b) and (c) and is to be accompanied by a certificate as to the contents of the return being true and correct in the form prescribed by the Board, signed by the account manager or on their behalf;

(b)the information specified in this sub-paragraph as regards the account holder is their—

(i)full name,

(ii)address of permanent residence including postcode,

(iii)date of birth, and

(iv)national insurance number, or unique reference number for the child trust fund relating to the transfer; and

(c)the information specified in this sub-paragraph as regards the account is—

(i)the type of account and that it represents a matured child trust fund,

(ii)the number allocated to it by the account manager, and

(iii)the aggregate market value of the investments in the account in that year.

(10) No transfer is to be made of any part of the CTF matured account, otherwise than in circumstances where the account manager intends to cease to act as an account provider, or ceases to qualify as such and any of regulations 19 (account provider’s intention to make a bulk transfer of accounts or to cease to act as an account provider), 20 (account manager ceasing to qualify) or 21 (relating to transfers of accounts) applies.]

Defaulted cash account subscriptionU.K.

5DA.  A subscription is a defaulted cash account subscription if—

(a)it is made to an account (which may be a stocks and shares account[F263, a cash account, an innovative finance account or a Lifetime ISA]) held by an account investor who held a cash account (“defaulted cash account”) in respect of which a default event occurred no more than 180 days before the subscription is made; and

(b)it does not exceed the amount held in the defaulted cash account immediately before the default event occurred (including interest accrued but not paid at that time) [F264plus, in the case of a flexible account, in the year in which the default event occurred and before such event, the amount (if any) of cash withdrawn from the account which was not replaced by a replacement subscription].

[F265Defaulted Lifetime ISA subscriptionU.K.

5DAA.  A subscription is a defaulted Lifetime ISA subscription if—

(a)it is made to a Lifetime ISA held by the account investor who held the Lifetime ISA in respect of which a defaulted investment payment has been made no more than 180 days before the subscription is made; and

(b)it does not exceed the defaulted investment payment.]

Defaulted investment subscriptionU.K.

5DB.  A subscription is a defaulted investment subscription if—

(a)it is made to [F266an account] held by the account investor who held the account in respect of which a defaulted investment payment has been made no more than 180 days before the subscription is made; and

(b)it does not exceed the amount of the defaulted investment payment.

Default event in respect of cash accountU.K.

5DC.  A default event in respect of a cash account held by an account investor occurs where the account manager of that account is determined to be unable or likely to be unable to satisfy claims against the account manager in accordance with the rules of the scheme for compensation established pursuant to section 213 of the Financial Services and Markets Act 2000.

Defaulted investment paymentU.K.

[F2675DD.   A defaulted investment payment occurs where a payment is made (otherwise than by accretion to an account) by way of compensation in respect of poor performance, loss (in whole or in part), depreciation or risk of depreciation of an investment (“defaulted investment”)—

(a)described in regulation 7, held in a stocks and shares account (whether or not the defaulted investment continues to be held in the account at the time of the payment); F268...

(b)described in regulation 8A, held in an innovative finance account (whether or not the defaulted investment continues to be held in the account at the time of the payment)[F269; or

(c)described in regulation 7 or 8, held in a Lifetime ISA (whether or not the defaulted investment continues to be held in the account at the time of the payment).]]

[F270Additional permitted subscription to an account other than a junior ISA accountU.K.

5DDA.—(1) A subscription to an account other than a junior ISA account is permitted by this regulation if—

(a)it is made in the circumstances described in paragraph (2); and

(b)the amount of the subscription, or the aggregate of a number of such subscriptions, does not exceed in value the amount determined in accordance with paragraph (3).

(2) The circumstances are—

(a)an account investor dies on or after 3rd December 2014 leaving a surviving spouse or civil partner (S);

(b)subject to paragraph (6), a subscription is made by S to an account or accounts managed by a single account manager or, in a case within sub-paragraph (e), the deceased’s account manager;

(c)the subscription is within the permitted period;

(d)S and the deceased were living together at the date of the deceased’s death; and

(e)where the subscription comprises non-cash assets—

(i)the deceased held an account either comprising or including non-cash assets at the date of the deceased’s death;

(ii)S inherits all or part of those assets;

(iii)S makes a subscription comprising those assets or any part therof; F271...

(iv)throughout the period beginning with the day on which the deceased’s account manager was notified of the deceased’s death and ending immediately before the subscription is made, title to those assets is vested in the deceased’s account manager, that manager’s nominee or jointly in one of them and another[F272; and]

[F273(v)in the case of an innovative finance account, paragraph (iv) shall apply but with the words from “title to” to “and another.” being substituted by “those assets remain under the management of the deceased’s account manager.]

(3) The amount is—

(a)where the deceased held a single account with a single account manager, then the value of that account at the date of the deceased’s death [F274or, in the event that the period for an administration-period investment in a continuing account of a deceased investor with an account manager ends and S has not made a subscription under paragraph (1), immediately before the account ceasing to be a continuing account of a deceased investor (whichever is the higher)]; or

(b)where the deceased held more than one account with a single account manager, then the combined value of those accounts at the date of the deceased’s death [F275or, in the event mentioned in paragraph 3(a) occurring, immediately before the account ceasing to be a continuing account of a deceased investor (whichever is the higher)];

but does not include any sums the deceased held in a junior ISA account.

[F276(3A) In respect of an innovative finance account, for the purposes of paragraph (3), the value of the account at the date of the deceased’s death [F277or, in the event mentioned in paragraph 3(a) occurring, immediately before the account ceasing to be a continuing account of a deceased investor (whichever is the higher)] is the combined value of the outstanding principal balance under those [F278qualifying investments for an innovative finance component] in respect of which payments are due to be made to the account manager of the account investor and cash deposited by the account investor under regulations 6(4) to (6).]

[F279(3B) For the purposes of paragraph (3) the value of a Lifetime ISA at the date of the deceased’s death [F280or, in the event mentioned in paragraph 3(a) occurring, immediately before the account ceasing to be a continuing account of a deceased investor (whichever is the higher)] includes any government bonus that has accrued to the date of death but has not been paid.]

(4) In this regulation, the permitted period means—

(a)in the case of a subscription comprising non-cash assets made in accordance with paragraph (2), the period beginning with distribution to S by the deceased’s estate of the non-cash assets and ending no more than 180 days thereafter;

(b)in the case [F281of] any other subscription under this regulation, the period beginning with the date of the deceased’s death and ending either—

(i)no more than 3 years thereafter; or

(ii)no more than 180 days after administration of the estate is complete;

whichever is the later.

(5) Where the deceased died in the period beginning with 3rd December 2014 and ending on 5th April 2015—

(a)for the purposes of paragraph (4)(a), distribution to S by the deceased’s estate of non-cash assets is treated as occurring on either 6th April 2015, or, the actual date of distribution, whichever is the later; and

(b)for the purposes of paragraph(4)(b), the deceased is treated as dying on 6thApril 2015.

(6) The requirement in paragraph (2)(b) is deemed as met where the Board authorises an account manager to accept a subscription from S.

(7) The following regulations do not apply to a subscription permitted by this regulation—

F282(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F282(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(c)6(3);

F283(d). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F283(e). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F284(f). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F285(8) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F285(9) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F285(10) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(11) In this regulation—

(a)“inherits” in paragraph (2)(e)(ii) includes inherits under a will trust or as a result of a deed of variation;

(b)“non-cash assets” means—

(i)those investments specified in regulation 7, other than those in paragraph (2)(j); and

(ii)those investments specified in regulation 8(2)(f), (h), (p) or (q); and

[F286(iii)the right to exercise the rights of the lender in respect of the outstanding principal balance under an article 36H agreement; and]

[F287(iv)those investments specified in regulation 8A(2)(ca); and]

(c)the value of a subscription comprising non-cash assets made pursuant to paragraph (2) is the value of the assets at the date of the subscription.]