UK Brokers to Pay 22% Charge on ISA Cash Interest as eToro Survey Shows Savers Unprepared
By Damian Chmiel
AI summary of the source article
Starting April 6, 2027, UK investment platforms will be required to pay a flat 22% charge to HM Revenue and Customs on interest earned by cash held in Stocks and Shares ISAs. The regulatory package also reduces the cash ISA allowance for savers under 65 from £20,000 to £12,000 and bars them from transferring funds from Stocks and Shares ISAs into cash ISAs. A survey of 2,000 savers conducted by Appinio for eToro revealed that only 38% knew about the 22% charge, while 48% mistakenly believed under-65s could still transfer funds into cash ISAs. Additionally, holding only money market funds inside Stocks and Shares ISAs will become non-qualifying.
Why it matters
The new 22% charge directly impacts how retail brokers and investment platforms monetize and advertise interest on uninvested client cash. Combined with allowance cuts, the rules risk confusing retail clients and altering asset flows across UK investment wrappers.
Key facts
- UK ISA managers will pay a flat 22% charge on Stocks and Shares ISA cash interest starting April 6, 2027.
- The annual cash ISA allowance for savers under 65 falls from £20,000 to £12,000, and transfers from Stocks and Shares to cash ISAs will be prohibited for this group.
- Only 38% of 2,000 savers surveyed for eToro were aware of the upcoming 22% charge.