Additional Permitted Subscription (APS) in an ISA
We answer the important questions around what APS is and what it means for you.
What is Additional Permitted Subscription (APS)?
Additional Permitted Subscription (APS) is a way for people to inherit their deceased spouse or civil partner's ISA, in the form of an increased one-off allowance. This allowance is on top of their own annual allowance (£20,000 for the 2024/25 tax year).
APS can be applied to any new or existing cash ISA, stocks and shares ISA, innovative finance ISA or lifetime ISA (there is a £4,000 cap on single transfers into lifetime ISAs under APS rules). Alternatively, you can apply the APS to a combination of ISAs.
Who is eligible for an APS allowance?
You are eligible for an APS allowance if you were married or in a civil partnership with someone who died on or after 3 December 2014.
You also need to have been living with them when they died, and you can’t have been separated. This includes being separated:
- under a court order
- under a deed of separation
- in circumstances where the marriage or civil partnership has broken down.
How is the APS determined?
The APS allowance rules depend on when your spouse or civil partner died.
Between 3 December 2014 and 6 April 2018
If your spouse or civil partner died between 3 December 2014 and 6 April 2018, the value of their ISA at the time of their death becomes your APS allowance.
After 6 April 2018
If the deceased passed away after 6 April 2018, their ISA will become a "continuing ISA". This means the funds in the ISA will retain their tax-free status and can still benefit from growth, although no more money can be added to it.
The ISA will keep its "continuing" status until one of these happens, whichever comes first:
- either the administration of the deceased's estate is completed,
- the ISA is closed with all funds withdrawn, or
- the third anniversary of their death.
If it reaches the third anniversary of their death, the APS is either the value of the ISA on your spouse or civil partner's death, or on the date it stops being a continuing ISA - whichever is higher.
How can the APS allowance be used?
The APS allowance is added to the surviving partner's current-year ISA allowance. For example, if your spouse or civil partner's ISA was valued at £25,000, it will be added to your allowance of £20,000 to give a total allowance of £45,000.
If the deceased had investments in their ISA, they can be transferred into the beneficiary's ISA without being sold, as long as both had their ISAs with the same provider.
You can use the APS allowance on your Stocks and Shares ISA, Cash ISA, Innovative Finance ISA or Lifetime ISA (LISA).
A LISA still has it’s £4,000 limit that also counts toward your total annual allowance - so you can’t put any additional cash into your LISA. But if you use your APS it’ll restore up to £4,000 that you’ve used in your LISA back to your annual allowance so you can use it on another ISA.
What are the time limits for using an APS allowance?
You can apply for an APS allowance for up to 3 years after the date of death, or 180 days after the administration of the estate is complete, whichever is later.
If you plan on using the APS allowance for making cash subscriptions, you don’t need to do these all in one go. But your subscriptions also need to made within these time limits. You don’t get any longer to use your APS if you waited longer to apply for it.
To use APS by stock transfer, this has to be completed within 180 days of the distribution of the assets to the surviving spouse.
Can I transfer my APS allowance to a different provider?
You can transfer your APS allowance to a new provider, if they accept APS accounts. This can be done only once, and only if you have not yet made any contributions to your APS allowance. If you have already made contributions to your APS, then you can transfer your ISA to another provider using the normal transfer process.
What happens if the savings are left to someone else?
You can still inherit your spouse or civil partner's ISA allowance regardless of who they left their money or investments to. For example, if your spouse or partner had an ISA worth £50,000, which they left to someone else, you would still be entitled to an increased ISA allowance of £50,000. However, you would need to use your own money to make your APS subscriptions.
