HM Revenue and Customs (HMRC) published a tax information and impact note on the Individual Savings Account and Child Trust Funds (Amendment No 2) Regulations 2024 on 15 October 20241. The note sets out three changes: allowing certain fractional interests in shares to be held in a stocks and shares ISA and a Child Trust Fund (CTF), requiring ISA managers to obtain a National Insurance number on new ISA applications from all investors eligible to have one, and updating the rules on transferring current year subscriptions between ISA managers1.
On fractional shares, the measure covers "certain 'fractional interests' in shares (also known as 'fractional shares) to be held in a stocks and shares ISA and Child Trust Fund (CTF)"1. This concerns holdings of part of a share rather than a whole share inside those accounts.
On National Insurance numbers, the note states the measure will "require ISA managers to get a National Insurance number on new ISA applications from all investors who are eligible to have one"1. The requirement is framed around new applications and around investors who are eligible to hold a National Insurance number.
On transfers, the third element will "update the rules about the transfer of current year subscriptions from one ISA manager to another"1. This concerns money subscribed in the current tax year and moved between providers.
"This tax information and impact note is about updates to information Individual Savings Account (ISA) managers must get for new applications, rules for ISA transfers between ISA managers, and allowing 'fractional interests'."
The three measures are summarised in the note as follows1:
| Measure | What the note says it does |
|---|---|
| Fractional shares | Allows certain fractional interests in shares to be held in a stocks and shares ISA and a CTF |
| National Insurance numbers | Requires ISA managers to get a National Insurance number on new ISA applications from all investors eligible to have one |
| ISA transfers | Updates the rules about transferring current year subscriptions from one ISA manager to another |
The note does not set out commencement dates for the individual measures, and no date of effect for the changes has been reported beyond the publication date of 15 October 20241. The note also does not state how the National Insurance number requirement applies to investors who are not eligible to hold one, or how fractional interests will be treated on transfer or withdrawal; those points have not been reported1.
Why it matters for households
The National Insurance number requirement affects anyone opening a new ISA who is eligible to have a number, because the manager will need to collect it as part of the application1. Existing accounts are not covered by the wording, which refers to new ISA applications1. For investors who hold part of a share rather than whole shares, the fractional shares measure concerns stocks and shares ISAs and Child Trust Funds, the two account types named in the note1. The transfer change concerns current year subscriptions, meaning money paid in during the tax year and then moved to a different ISA manager1. The note does not give dates from which each change applies, so the timing of any effect on applications, holdings or transfers has not been reported1.
What happens next
The regulations and the accompanying note were published on 15 October 20241. No further steps, commencement dates or transitional arrangements are set out in the published note1.
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