ISAs for Non-UK Residents: Rules, Tax Implications & Expat Investment Alternatives

Can You Open or Maintain an ISA While Living Abroad?

• Opening a new ISA abroad: Non-UK residents cannot open a new ISA. You must be a UK resident for tax purposes to open one.

• Keeping an existing ISA: If you already had an ISA before leaving the UK, you can keep it open. Your investments will remain within the account and continue to grow.

• Contributions: Once you’re classed as non-UK resident, you cannot contribute new funds to your ISA. Your annual ISA allowance (£20,000 in 2025/26) is no longer available to you.

• Withdrawals: If you withdraw money from your ISA while abroad, the UK tax-free treatment won’t apply in your new country. Most countries will tax ISA withdrawals as regular income or capital gains.

In short: your ISA becomes “frozen” while you’re overseas — you can keep it but not contribute, and withdrawals may lose their tax advantages.

Are ISAs Worth Keeping Open as a Non-Resident?

Keeping your ISA may still make sense if:

• You plan to return to the UK in the future — you’ll regain contribution rights when you re-establish UK tax residency.

• You want to keep existing investments sheltered — although tax-free status only applies in the UK, keeping investments inside the ISA might make portfolio management easier when you move back.

However, if you don’t expect to return, you may want to consider alternative investment accounts in your country of residence.

Alternatives to ISAs for Non-UK Residents

Since ISAs don’t offer ongoing benefits abroad, expats often explore other solutions:

1. Locally Tax-Efficient Investment Wrappers

Many countries have their own tax-efficient savings structures. Examples include:

• France: Assurance Vie – a long-term investment wrapper with inheritance and income tax benefits.

• USA: IRAs and 401(k)s – for residents with earned income in the States.

• Australia: Superannuation funds.

These products can be highly advantageous if you’re planning long-term residence in your new country.

2. Platform-Based Investment Accounts

If you prefer global flexibility, consider using an international investment platform. These typically offer:

• Access to global stocks, ETFs, and bonds.

• Multi-currency accounts (to avoid FX fees).

• Portability if you relocate again.

• No contribution restrictions based on UK residency.

This option is especially attractive for globally mobile professionals and digital nomads.

Tax Implications of Managing an ISA Abroad

The most important factor when dealing with an ISA overseas is taxation:

• UK tax status: The UK continues to treat ISA investments as tax-free.

• Foreign tax rules: Your new country may not recognize ISA tax advantages. For example, in the US, ISAs are not tax-sheltered, and income inside an ISA may be reportable.

• Double taxation treaties: Some countries have agreements with the UK that may reduce tax liabilities, but this varies widely.

Always consult a local tax adviser who understands cross-border taxation before making withdrawals or transferring investments.

Frequently Asked Questions (FAQs)

1. Can I transfer my ISA abroad?
No, ISAs are UK-specific products. You cannot transfer them into foreign savings accounts.

2. What happens to my ISA if I return to the UK?
You can resume contributions immediately once you re-establish UK residency for tax purposes.

3. Can I keep my Lifetime ISA as an expat?
Yes, but you cannot add new contributions while abroad. Government bonus eligibility also stops if you’re not UK-resident.

4. Should I close my ISA before leaving the UK?
Not necessarily. If you plan to return, keeping it open may be worthwhile. However, if you’ll settle abroad permanently, other local tax-efficient investments may serve you better.

Final Thoughts

Managing an ISA as a non-UK resident can be challenging. While you can keep your account, you can’t contribute while abroad, and the tax benefits often don’t apply in your new country.

If you’re planning to return to the UK, it usually makes sense to keep your ISA open. If not, exploring local tax-efficient investments or global platform-based accounts may provide better long-term growth.

Next step: Speak with a cross-border financial adviser to determine the most tax-efficient strategy for your personal circumstances.