“ISA-nt” It Time to Invest?

Discover how ISAs can help you grow your wealth tax-free with Interactive Brokers! In this episode, we break down everything from investment options to fees—so you can make the most of your money while keeping more of it in your pocket.

Summary – IBKR Podcasts Ep. 231

The following is a summary of a live audio recording and may contain errors in spelling or grammar. Although IBKR has edited for clarity no material changes have been made.

Andrew Wilkinson

Hello, everybody. Welcome to this week’s episode of our IBKR podcast series. My name is Andrew Wilkinson, and I’m talking to Gerry Perez, CEO of Interactive Brokers UK in London. How are you, Gerry? 

Gerry Perez

Good, Andrew. Thank you for the opportunity to speak to the crowd. 

Andrew Wilkinson

Well, you told me recently, Gerry, that the UK tax year is ending on April 5th, I believe, and Interactive Brokers recently announced the addition of mutual funds for ISA accounts. Since I’ve been in the United States for about 25 years, I’m a little bit behind on what ISAs are. Tell me—tell the audience—what is a stocks and shares ISA? 

Gerry Perez

A stocks and shares ISA is a UK tax wrapper account, one of many individual savings accounts available for UK residents over 18 years of age. In the case of an individual under the age of 18, there’s a junior ISA, which IBKR also supports. 

Let me simplify the ISA’s purpose with a metaphor. Imagine you want to plant a seed in your backyard to grow a fruit-bearing tree, which signifies your investment portfolio for retirement. However, your plant—or your portfolio—faces risks like weather or pests. Let’s call these taxes, which impact it before it reaches its useful retirement life. 

Now, imagine the same plant wrapped up in an invisible cover—let’s call this a tax wrapper or an ISA. It shields your investment from capital gains tax. 

When it comes to growing your plant—or portfolio—you can use different types of nutrients, like stocks, ETFs, mutual funds, and so on, to enrich the soil and help your investments flourish. So, there you go—that’s what an ISA is. 

To add to that, your annual ISA contributions, which can be made within the tax year, allow you to invest up to a specified limit—currently £20,000. This limit applies across all types of ISAs you own, with the exception of a junior ISA, which has a maximum contribution of £9,000 per annum. 

There’s no fixed term for an ISA, meaning you can hold and manage your investments for the long term or sell them whenever needed. However, things to consider: your capital is at risk, and the value of your investments can go up or down. An ISA can be a powerful tool for growing your wealth while benefiting from tax relief. 

Andrew Wilkinson

That’s pretty clear, Gerry. What makes Interactive Brokers’ ISAs stand out from others? 

Gerry Perez

IBKR is renowned for its innovative investment platforms, comprehensive global market access, educational resources, and a competitive pricing model. 

We realize that, in speaking to our customers, they are on a journey leading up to retirement. Along that journey, their investment needs and skills evolve. Our platforms are designed to enhance and support our customers as they mature as investors. 

You can choose the IBKR platform that best matches your trading style and skill level. We offer several platforms—from our client portal and desktop mobile app to our GlobalTrader app. 

By leveraging our tools, including market scanners and analytical features, we help users process vast amounts of data with smart insights and risk management strategies. Our goal is to empower investors with technology and automation to maximize their success. 

We also offer an extensive catalog of educational content, including webinars, articles, videos, and tutorials—all free—covering trading strategies and market insights. These resources empower investors to grow their knowledge and better manage their investments. 

Our ISAs stand out because we offer some of the lowest trading fees in the market (source), making them particularly attractive to cost-conscious investors looking to maximize their returns. 

Andrew Wilkinson

So, Gerry, what tools are available in the IBKR platform to help optimize an ISA user’s portfolio? 

Gerry Perez

There are many free tools that we offer. 

For instance, the Global Analyst allows you to scan the world for investment opportunities based on your inputs, automatically finding stocks that match your high- or low-value strategies. This makes it easier to identify global stocks that align with your needs. 

Our Mutual Funds Search Tool offers over 13,000 funds for your ISA. It’s easy and free to use. 

You can also access real-time data for any product we offer, including buy/sell options, market depth, and more—just like professional traders. 

Our Fundamentals Explorer provides comprehensive data on stocks, helping investors make informed decisions. 

For technical analysts and market insiders, we offer premium charting tools for free. These tools analyze technical patterns, aiding in investment decisions. 

Additionally, users have access to in-depth market newsfeeds and research to stay ahead of trends. We also offer dividend reinvestments for U.S. and Canadian shares. Many more tools can be found on our website. 

Andrew Wilkinson

Gerry, what marketplace access does Interactive Brokers offer ISA customers? 

Gerry Perez

Brokers are defined by the quality, quantity, and affordability of their offerings. 

We cater to customers who want choice, so we provide access to thousands of worldwide markets across North America, Asia, and Europe. Customers can trade stocks, ETFs, mutual funds, and more. 

At IBKR, we offer both general investment accounts and ISAs, allowing customers to choose either or both. We make it easy to invest in both with a single sign-on, enhancing ease of access and portfolio diversification. 

Andrew Wilkinson

And tell us about the fees and costs applicable for ISA customers, Gerry. 

Gerry Perez

Our pricing strategy is important because it directly impacts customers’ returns and reflects our commitment to delivering exceptional value. 

For example, our simple investment and pricing model includes: 

• No cost to open an ISA 

• No minimum deposit required 

• No subscription or maintenance fees 

• No transfer fees 

• No custody or annual fees 

For example, if you have a portfolio worth £10,000, there are no annual custody fees to keep it with IBKR—a significant savings. 

We do ask for a minimum brokerage fee of £3 per month for stocks and shares ISAs and £1 for a junior ISA. 

We offer two commission structures: 

1. Fixed pricing – A single fee per transaction, including brokerage, clearing, and exchange fees. 

2. Tiered pricing – A sliding scale where the more you trade, the less you pay. 

For example, in a tiered scheme for UK stocks, we charge 0.05% per trade. In a fixed fee schedule for U.S. stocks, we charge $0.005 per share, with a $1 minimum per trade. 

Our FX conversion rate is 0.03%, which is highly competitive and makes a real difference compared to other brokers. Additionally, we pay competitive interest on uninvested cash in ISA accounts. 

Andrew Wilkinson

And Gerry, how easy is it to open an account? 

Gerry Perez

Relatively easy.

• Visit interactivebrokers.co.uk and click on “Open an Account” in the top-right corner. 

• Choose the account type (ISA). 

• Fill out the online application. 

• We may ask for identification documents for verification. 

• Once verified, fund your account. 

• Once funded, you’re ready to invest. 

The entire process takes just a few minutes. 

Andrew Wilkinson

And what about transferring an existing ISA to Interactive Brokers? 

Gerry Perez

Great question. Interactive Brokers supports in-specie transfers from other providers. If we offer the product, there’s no need to liquidate your positions first—this results in huge savings for our customers. 

Andrew Wilkinson

And what support does Interactive Brokers offer ISA investors? 

Gerry Perez

We provide: 

• A client portal for managing investments 

• A self-service knowledge base 

• AI-powered assistance (iBot) 

• 24/5 customer support 

• Educational resources 

• A demo account 

• Multi-language support 

Additionally, our IBKR Campus offers podcasts, tutorials, and market insights. 

Andrew Wilkinson

Brilliant. Gerry Perez, CEO of Interactive Brokers UK, thank you for joining me today. 

Gerry Perez

Thank you, Andrew. And remember, at IBKR, you pay a small ISA price but get great value. Visit interactivebrokers.co.uk to open an ISA today. 

Andrew Wilkinson

Thanks, Gerry. And to our audience, don’t forget—if you liked today’s podcast, subscribe wherever you download your podcasts!