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I've been thinking about starting a UK Stocks & Shares based ISA. I am planning on using my Banking company to start the ISA with. I understand that they have a 2% annual maintenance charge for the ISA.

What does that mean? Does it mean any of the following?

  1. They send me a bill asking me to pay 2%?
    • If that is the case, then 2% of what, the current value of the shares? 2% of the amount of money I have invested? or 2% of something else?
  2. They somehow reduce the value of the shares in the ISA by 2% to cover they fees
    • If that is the case, how do they do that, do they sell 2% of the shares or something?
  3. Or do they get their 2% using some other method?

Just for clarification, I am thinking about starting a Stocks & Shares based ISA where I chose the shares myself.

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It would be worth looking at their details as they will outline clearly what the 2% is on.

Having said that the 2% will probably be on the value of the portfolio at the time the charge is calculated. (It might be that they don't levy this on the cash section of portfolio, it might be that they do.)

They will usually make you sign a direct debit form so that they can take the fees straight from you.

There are much better deals around than this, 2% is a huge fee if you had an portfolio that is worth £100,000 after some years the fees they would be charging you would be £2,000 a year. it's worth shopping around for a better deal, as it can prove costly to change ISA provider at later date.

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  • The Telegraph has a comparison of the main ISA providers and high street banks ted not have very good rates for S&S ISA's
    – Pepone
    Commented Apr 3, 2015 at 11:27

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