It’s one of the first things people ask me when they’re planning a move to Portugal: “What do I do about my ISAs?” And honestly, it’s a great question — because the answer isn’t as straightforward as most people expect.

If you’ve spent years carefully building up your ISA portfolio — whether that’s a Stocks and Shares ISA, a Cash ISA, or both — the thought of losing that tax-free wrapper can feel like a punch to the gut. The good news? You don’t lose your ISAs when you move abroad. The less good news? The tax-free bit gets a lot more complicated.

Let’s break it all down so you know exactly where you stand.

Can You Keep Your ISA When You Leave the UK?

Yes, you can. When you become a non-UK resident, your existing ISAs remain open. Your investments stay exactly where they are, and they continue to grow within the ISA wrapper. HMRC doesn’t force you to close them or sell anything.

However — and this is the important bit — you can no longer make new contributions to your ISA once you become non-UK resident. Not a penny. The door closes the moment you leave.

So if you’re planning a move to Portugal for, say, July 2026, it’s worth maxing out your ISA allowance (currently £20,000) before you go. Once you’re out, that’s it until you return to the UK as a tax resident.

Are Your ISA Returns Still Tax-Free?

Here’s where it gets interesting — and where a lot of people get caught out.

From HMRC’s perspective, your ISA remains a valid tax-free wrapper. The UK won’t tax the interest, dividends, or capital gains generated inside your ISA. So far, so good.

But you’re no longer just answering to HMRC. As a Portuguese tax resident, you’re subject to Portuguese tax rules on your worldwide income. And Portugal doesn’t recognise the ISA as a tax-free vehicle. To the Portuguese tax authorities (Autoridade Tributária), your ISA is just another investment account.

That means:

• Dividends from shares held in your ISA are taxable in Portugal
• Interest from a Cash ISA is taxable in Portugal
• Capital gains when you sell investments inside your ISA are taxable in Portugal

The standard tax rate on investment income in Portugal is 28% (a flat rate for most categories). If you opt to include investment income in your general tax return instead, it’s taxed at your marginal rate, which could be higher or lower depending on your total income.

What About NHR (Non-Habitual Resident) Status?

If you arrived in Portugal before 2024 and secured NHR status, you may have had access to favourable tax treatment on foreign-source income. Under the original NHR regime, foreign dividends and interest could be taxed at a flat 10% or even exempt in some cases, depending on the source and any applicable double taxation agreements.

However, the NHR regime has been replaced by the IFICI (Incentivo Fiscal à Investigação Científica e Inovação) programme from 2024 onwards, which has much narrower qualifying criteria. Most retirees and standard expats won’t qualify for IFICI.

If you do have existing NHR status, it continues for the remainder of your 10-year period. This could mean more favourable treatment of your ISA income during that window. But once NHR expires, standard Portuguese tax rates apply. We covered this in detail in our article on what happens after your NHR expires.

Should You Keep Your ISA or Cash It In?

This is the million-pound question (or the twenty-thousand-pound question, if we’re being literal about ISA limits). The answer depends on your individual circumstances, but here are the key considerations:

Reasons to keep your ISA

• You might return to the UK — if you move back, you regain full ISA benefits immediately, and you can start contributing again
• Your investments are performing well — there’s no point disrupting a good portfolio just because the wrapper has changed
• Capital gains tax timing — if you sell now, you could trigger a taxable event in Portugal. Holding may defer the tax
• Simplicity — if the amounts are modest, the hassle of restructuring may not be worth it

Reasons to consider restructuring

• The ISA wrapper no longer saves you tax — you’re paying Portuguese tax on the returns regardless, so the ISA structure offers no benefit
• Better structures may be available — depending on your situation, a compliant investment bond or other wrapper could be more tax-efficient under Portuguese rules
• Reporting obligations — Portugal requires you to declare worldwide assets. An ISA doesn’t exempt you from this, and having investments in a structure Portugal does recognise can simplify your tax return
• Platform issues — some UK ISA providers won’t serve non-UK residents, which could force your hand anyway

Will Your ISA Provider Even Keep You?

This is a practical headache that catches many expats off guard. Since Brexit, a growing number of UK investment platforms have stopped serving clients who live in the EU. This isn’t about your ISA — it’s about the platform’s regulatory permissions.

Some of the bigger platforms — like Hargreaves Lansdown, AJ Bell, and Interactive Investor — have varying policies on non-UK residents. Some will let you keep existing accounts but won’t let you open new ones. Others may ask you to transfer out entirely.

Before you move, check with your ISA provider about their policy on non-UK residents. If they won’t keep you, you’ll need to transfer your ISA to a provider that will — or consider whether to restructure entirely. This is one of those things that’s much easier to sort out before you leave the UK rather than after.

What About Premium Bonds?

While we’re on the subject of UK savings, Premium Bonds come up almost as often as ISAs. The good news: NS&I allows you to keep your Premium Bonds when you move abroad. You can even still win prizes.

The catch? Just like ISAs, any prizes you win are potentially taxable in Portugal. In the UK, Premium Bond prizes are tax-free. In Portugal, they’re treated as income. A £1,000 prize could face 28% tax, leaving you with £720. Still nice to win, but not quite the windfall you’re used to.

You also cannot buy additional Premium Bonds once you leave the UK. The maximum holding remains at £50,000, but you can’t add to it as a non-resident.

Cash ISAs: Are They Worth Keeping?

Cash ISAs deserve a special mention because the maths often works against keeping them as an expat.

If your Cash ISA is earning, say, 4% interest, and Portugal taxes that interest at 28%, your effective return drops to about 2.88%. You might find better returns in a Portuguese bank account or a euro-denominated savings product — and you’d avoid the currency risk of holding sterling.

We wrote about currency risk for UK expats recently, and it’s directly relevant here. If your living costs are in euros but your savings are in sterling, exchange rate movements can wipe out your interest gains and then some.

For larger Cash ISA balances, it’s worth doing the maths on whether to move to a euro-denominated product. For smaller amounts, the hassle may not be worth it.

Reporting Your ISAs on Your Portuguese Tax Return

As a Portuguese tax resident, you must declare your worldwide income on your annual IRS (Imposto sobre o Rendimento das Pessoas Singulares) tax return. This includes any income generated inside your ISAs.

You’ll need to report:

• Dividends received (even if reinvested)
• Interest earned
• Capital gains realised on sales

You don’t need to report unrealised gains — only actual disposals. But you do need to keep track of your cost basis (what you originally paid for investments) to calculate gains correctly. This can get fiddly if you’ve been drip-feeding money into funds over many years.

If you’re claiming relief under the UK-Portugal Double Taxation Agreement, you’ll need to ensure income isn’t being taxed twice. The DTA generally gives Portugal the right to tax investment income for Portuguese residents, but it’s worth checking the specifics with a qualified adviser.

Lifetime ISA (LISA): A Special Case

If you have a Lifetime ISA, moving abroad adds extra complexity. The LISA was designed for first-time house purchases in the UK or retirement savings. If you withdraw funds for any purpose other than buying a UK property or reaching age 60, you’ll face a 25% withdrawal penalty.

Moving abroad doesn’t change this. You can keep the LISA, but if you need the money before age 60 and aren’t buying a UK property, that penalty still applies. It’s worth weighing up whether the 25% hit is worth taking now versus waiting.

Frequently Asked Questions

Can I open a new ISA from Portugal?

No. Once you become non-UK resident, you cannot open new ISAs or contribute to existing ones. Your existing ISAs remain open, but no new money can go in until you return to the UK as a tax resident.

Do I need to tell HMRC I’ve left the UK?

Yes. You should complete form P85 (or a Self Assessment tax return) to notify HMRC of your departure. This doesn’t affect your ISA directly, but it’s a legal requirement and ensures your UK tax affairs are in order.

Will I pay tax twice on my ISA income?

Potentially, but the UK-Portugal Double Taxation Agreement is designed to prevent this. Since the UK doesn’t tax ISA income anyway, the main concern is ensuring Portugal correctly taxes you at the appropriate rate without double-counting.

Can I transfer my ISA to a Portuguese equivalent?

Portugal doesn’t have a direct equivalent to the UK ISA. However, there are tax-efficient investment structures available in Portugal (and across the EU) that may serve a similar purpose. A financial adviser familiar with both jurisdictions can help you find the best option.

What happens to my ISA if I die as a Portuguese resident?

Your ISA forms part of your estate. In Portugal, there’s no inheritance tax as such, but there is Imposto do Selo (stamp duty) at 10% on assets passed to anyone other than a spouse, descendants, or ascendants. The close family exemption means your spouse and children would receive the ISA tax-free under Portuguese rules. We covered this in our guide to inheritance tax in Portugal.

The Bottom Line

Your ISA doesn’t disappear when you move to Portugal, but its superpower — the tax-free bit — effectively does. Portugal will tax the income and gains from your ISA just like any other investment. That doesn’t mean you should rush to close everything, but it does mean the ISA wrapper is no longer doing the heavy lifting it used to.

The right move depends on your individual circumstances: the size of your ISAs, your other income sources, your plans for the money, and whether you might ever return to the UK. This is exactly the kind of situation where getting advice from someone who understands both the UK and Portuguese systems can save you a lot of money — and a lot of headaches.

Got questions about your ISAs or other UK savings? We help UK expats in Portugal navigate exactly these kinds of cross-border financial puzzles every day. Get in touch for a free initial chat — no jargon, no pressure, just clear answers.

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