New guidelines on Isa inheritances

New guidelines have been published on the inheritance of Isa investments for surviving spouses.

George Osborne brought in new rules in last year's Autumn Statement allowing a spouse to benefit from their partner's Isa allowance on death.

The so-called "additional permitted subscription" (APS) gives a surviving spouse a one-off Isa allowance equal to the value of the deceased's Isa savings at death, and does not count towards their normal Isa limit.

The guidelines make clear that not all Isa providers will accept APS but all are obliged to pass on APS information to another Isa provider. Some providers will allow payments in instalments but others demand lump sums.

Produced by Tisa, the financial services membership association, the British Bankers' Association and the Building Societies Association, the guidelines say the allowance is available for three years after death.

Carol Knight, Tisa operations director, said: "Approximately 150,000 married Isa holders die each year and so these changes will benefit spouses or civil partners of Isa holders who die on or after December 3 2014 by increasing the amount that they can save by offering the tax advantages in an Isa wrapper."

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