ISAs & Premium Bonds for UK expats: what matters most
Worried whether a move abroad will wreck an ISA or stop Premium Bonds paying tax-free returns? This guide gives direct, practical answers for UK residents who become non-residents: eligibility, tax consequences abroad, everyday mistakes and the exact actions to take today to protect savings.
Key facts, rules and hyperlinks to official guidance are included so the reader can act with confidence. All rules are indicative and current at time of writing (28 Jan 2026).
Key takeaways: what to know in 60 seconds
- ISAs can usually be kept after leaving the UK but cannot receive new subscriptions while non-resident. Existing tax-free status remains for UK tax purposes, but local tax treatment may differ.
- Premium Bonds (NS&I) can normally be held by non-residents in many countries, but new purchases are restricted to UK residents only; eligibility depends on nationality and local rules.
- Tax on returns depends on where the expat is tax resident. UK tax advantages for ISAs apply to UK tax residents only; NS&I prizes are tax-free in the UK but may be taxable abroad.
- Common mistakes include assuming UK tax status follows residency, failing to notify providers of address changes, and ignoring US/FATCA reporting requirements.
- Inheritance and nomination rules differ: keep nominations updated and remember probate and local succession rules may apply overseas.
Can UK expats keep ISAs after moving abroad?
Who can keep an existing ISA when they leave the UK?
- A person who moves abroad can usually keep their existing ISA(s). Providers rarely force closure purely because of non-residence. The tax wrapper remains valid for UK tax purposes while the account exists.
- Crucial limitation: a non-resident cannot subscribe to (pay into) most ISAs while non-resident. Subscriptions are permitted only for UK tax residents, except a limited exception for Crown employees posted overseas and their spouses/civil partners.
- For up-to-date rules see HMRC: HMRC ISA guidance.
Practical steps when moving abroad
- Notify ISA providers of a change of address and provide any documents requested for identity/anti-money‑laundering checks.
- Check provider terms: some banks or platforms may have their own residency restrictions and could ask the account to be closed if they do not accept overseas customers.
- Consider leaving money in the ISA if the provider permits it and the UK tax wrapper remains beneficial relative to local tax rules.
Special case: Crown employees and public servants
- Crown employees (eg diplomats, certain military personnel) posted overseas and their spouses can continue to subscribe to ISAs while non-resident. Evidence of status is required by providers and HMRC.
Eligibility rules for NS&I Premium Bonds and ISAs for non-residents
Who may hold Premium Bonds after moving abroad?
- NS&I (National Savings & Investments) historically allows existing Premium Bond holders to keep bonds after moving abroad, but new purchases usually require UK residency.
- Eligibility can also depend on nationality. Some non-UK nationals resident in the UK could hold or buy Premium Bonds while resident, but rules change—always check NS&I: NS&I premium bonds.
- UK citizens moving abroad should confirm whether NS&I continues to accept them as customers; some countries impose local restrictions on holding UK government debt or on prize tax treatment.
ISA eligibility rules at a glance
- To open and subscribe to any ISA (Cash ISA, Stocks & Shares ISA, Lifetime ISA) the subscriber must be a UK resident for tax purposes in that tax year, or be an eligible Crown employee posted overseas or spouse/civil partner.
- Existing ISAs held before leaving can remain open but cannot receive new contributions from a non-resident.
Quick comparison table: eligibility and subscription rules
| Feature |
ISA |
Premium Bonds (NS&I) |
| Can keep after moving abroad |
Yes, usually. |
Yes, usually. |
| Can subscribe while non-resident |
No (except some Crown employees). |
Generally no; depends on NS&I policy and country. |
| UK tax-free status |
Preserved for the life of the ISA but depends on UK tax residence for subscriptions. |
Prizes are tax-free in the UK. |
| Local tax treatment likely |
May be taxable abroad; check local rules. |
Possibly taxable abroad; check local rules. |
Tax implications for Premium Bonds and ISAs abroad
UK position vs local tax residence
- The UK treats ISA income and gains as tax-free for UK tax purposes while the account exists. NS&I Premium Bonds prizes are tax-free in the UK.
- Whether an expat pays tax on ISA interest, investment growth, or Premium Bond prizes depends on where they are tax resident. Many countries tax worldwide income, which may include ISA returns or Premium Bond prizes.
- Check country-specific guidance and treaties. HMRC explains residence and ties: HMRC residence guidance.
Common country treatments (indicative examples at time of writing)
- United States: ISAs are not tax-advantaged for US tax residents. ISA gains and interest must be reported to the IRS. Premium Bond prizes may be taxable as gambling or miscellaneous income and reporting under FBAR/FATCA can apply. See IRS international taxpayers.
- Spain: ISAs are often treated as taxable savings; Premium Bond prizes can be taxable. Local tax rates and allowances apply.
- Ireland: Tax treatment varies; declare foreign income where required.
Always verify current local practice with a tax adviser in the destination country. Double taxation agreements (DTAs) sometimes allocate taxing rights; the DTA with the UK can help avoid double taxation in many cases.
Practical tax reporting steps for expats
- Retain ISA and Premium Bonds statements. Use these when filing local tax returns and when proving tax history to HMRC if required.
- If a local tax authority requires tax on an ISA or Bond prize, document whether foreign tax credits or treaty relief is available.
- Non-UK residents who later return to the UK should keep records of what happened to their accounts while away.
How withdrawals and transfers are taxed for expats
Withdrawals from ISAs while non-resident
- Withdrawals from an ISA are not taxed in the UK. However, local tax rules may treat withdrawals differently (eg taxable interest or capital gains). The tax status often depends on whether the gain was realised while tax resident in the foreign country.
- A withdrawal that converts investments into cash does not change the UK tax wrapper for the past period; it simply realises the value.
Transfers between providers and moving back to the UK
- Transfers between ISAs in the UK should use the official transfer process to preserve the ISA wrapper. If a transfer requires closing the ISA (withdraw and re-open) the tax advantages could be lost.
- If an expat returns to the UK and wants to subscribe again, subscriptions are allowed in the tax year of return assuming UK tax residence is re-established.
Premium Bond prizes and payout while abroad
- NS&I pays prizes to holders wherever they live (subject to bank/payment limits and verification). Prizes are tax-free in the UK but may be taxable abroad. Payment methods vary (bank transfer, cheque).
- If prizes are paid to an overseas bank account, check whether NS&I requires additional verification or imposes processing delays.
Common mistakes expats make with ISAs and Premium Bonds
Mistake 1: assuming UK tax advantages work overseas
- Believing that an ISA remains tax-free everywhere can be costly. Assume the local tax authority may tax ISA gains or Premium Bond prizes until confirmed otherwise.
Mistake 2: not updating provider details
- Failure to tell the provider about a change of address may breach terms and result in account closure or frozen payments. Providers need correct residency status for ID and compliance checks.
Mistake 3: attempting to subscribe while non-resident
- Trying to make new ISA subscriptions after becoming non-resident is not allowed (except for limited cases). Deposits may be returned and the tax year subscription lost.
Mistake 4: ignoring US reporting rules
- US citizens or residents must report worldwide accounts and income (FBAR, FATCA). ISAs are often treated unfavourably under US rules; failure to report can trigger penalties.
Mistake 5: leaving nominations out of date
- Nominations for ISA beneficiaries and Premium Bonds must be kept updated; an outdated nomination can complicate inheritance and probate overseas.
Simple decision flow for expats with ISAs & Premium Bonds
ISA & Premium Bonds: decision flow for UK expats
🧭 Quick flow to decide whether to keep, transfer or close accounts:
**Step 1** → Update provider with new address and residency status.
**Step 2** → Check local tax rules: will ISA interest/gains or Premium Bond prizes be taxed?
**Step 3** → If taxed locally, calculate net return vs alternatives in host country.
**Step 4** → Decide: keep (✓), transfer to UK provider on return (↩), or close and repatriate funds (✗).
Icons: ✓ keep, ↩ transfer later, ✗ close and repatriate — choose based on tax & provider acceptance.
When to keep ISAs & Premium Bonds and when to close them: benefits, risks and errors to avoid
Benefits / when to keep
- ✅ Keep ISAs if the provider accepts non-resident customers and the local tax treatment is favourable or neutral.
- ✅ Keep Premium Bonds where prizes remain attractive and local tax liability is low or manageable.
- ✅ Maintaining accounts preserves flexibility for return to the UK and avoids crystallising gains that could trigger local tax.
Risks / errors to avoid
- ⚠️ Keeping accounts without checking local reporting rules (eg FATCA for US) can create major compliance burdens.
- ⚠️ Not verifying a provider’s overseas customer policy: some banks may freeze or close accounts if they do not support non-resident customers.
- ⚠️ Assuming transfers back to the UK are frictionless: currency, bank details and timescales can complicate redemption.
Inheritance, closure and nomination for ISAs and Premium Bonds
Nominations and beneficiary rules
- ISA nomination (a written nomination of a person to receive ISA proceeds) should be kept current. If no valid nomination exists, the estate passes under local succession rules.
- Premium Bonds have a nomination system; check NS&I guidance for how to nominate or change the nominee: NS&I help and guides.
What happens on death when living abroad
- On death, ISAs lose their ISA wrapper and the estate may need to deal with the assets according to UK probate and the local country's succession law.
- For spouses, an additional ISA allowance (Additional Permitted Subscription) may be available in the UK if a surviving spouse is UK resident. The mechanisms can be complex for non-resident estates; seek specialist advice.
Practical checklist for inheritance planning as an expat
- Keep nominations up to date with providers.
- Ensure wills cover UK assets and check whether a separate UK will is advisable to simplify local probate.
- Inform next of kin where statements and passwords are kept; maintain a list of account details securely.
Frequently asked questions
Can I open a new ISA if I move back to the UK mid-year?
Yes. If UK tax residence is regained in the tax year, the normal subscription rules apply and the individual can make new ISA subscriptions for that tax year.
Are Premium Bond prizes taxed in other countries?
They can be. Many countries tax gambling or windfall income; local rules vary. Check the destination country’s guidance or a local tax adviser.
Will HMRC close my ISA if I become non-resident?
HMRC normally does not force closure. Providers may require information and could close accounts if they cannot lawfully serve non-resident clients.
Do I need to declare my ISA to HMRC if I am non-resident?
Non-residents do not typically pay UK tax on ISA returns, so there is no UK return requirement solely because of ISA returns. However, if there is UK taxable income or other obligations, declarations may be needed. Check HMRC guidance.
US citizens must comply with FBAR and FATCA reporting and often have to declare ISA holdings and any income to the IRS. ISAs are usually not tax-favoured in the US.
Can children keep Junior ISAs after the child leaves the UK?
Junior ISAs are subject to similar residency rules. Providers’ policies vary; typically the child must be UK resident to subscribe, although existing accounts can often remain.
How quickly will NS&I pay a prize to an overseas bank account?
Payment timing varies; delays can occur due to international transfer checks or foreign bank processing. NS&I will outline options on request.
Your next step:
- Check status: contact ISA and NS&I providers, confirm whether accounts can remain open and how prizes/payments are handled overseas.
- Verify tax position: consult a local tax adviser or use HMRC and NS&I guidance to determine whether ISA returns or Premium Bond prizes are taxable where the reader will be resident.
- Update nominations and paperwork: ensure beneficiary nominations, emergency contacts and provider records are current and accessible.