The short answer
- Usually yes. Providers give a cooling-off period after you open or transfer an ISA. The FCA's rules set a 14 calendar day cancellation period for a cash deposit ISA, and HMRC says the period can be up to 30 days after you are told about the right to cancel.
- Your allowance is protected. HMRC's guidance says a subscription cancelled within the cooling-off period is treated as though it was never made, so it does not use any of your overall ISA allowance.
- Cancelling is not the same as withdrawing. Some providers instead offer a right to withdraw of 7 to 14 calendar days before the ISA starts. Either way the subscription does not stand, so you can use that money in another ISA in the same tax year.
- A transfer already under way can often still be unwound: tell your new provider straight away. Once a transfer has completed there is no guarantee, so check the provider's own terms.
Can you cancel an ISA or an ISA transfer?
Usually yes, if you act inside the cooling-off period. When you open or transfer an ISA, your provider has to give you a window in which you can change your mind. The FCA’s cancellation rules set a 14 calendar day cancellation period for a cash deposit ISA, and HMRC’s guidance for ISA managers says the period is set out in the account’s terms and can run up to 30 days after you are told about the right to cancel.
There are two forms this can take, and they are not the same thing. One is a right to cancel after the ISA has started. The other is a right to withdraw before it starts. HMRC’s guidance lets providers offer either, so the first thing to do is read your own account’s terms.
| Feature | Right to cancel | Right to withdraw |
|---|---|---|
| When it applies | After the ISA has started | Before the ISA starts |
| How long | A set period in the terms, up to 30 days (14 days for a cash deposit ISA under FCA rules) | 7 to 14 calendar days from when the provider receives your application |
| Effect on your allowance | Treated as though you never subscribed | The ISA never started, so no subscription was made |
This page explains how the cooling-off period works, what it does to your allowance, and what to do about a transfer that has already started. It names no provider, and it is general information, not advice.
The cooling-off rules at a glance
- Cash deposit ISA cancellation period
- 14 calendar days
- FCA rules, from the later of concluding the contract or receiving the terms
- Maximum cancellation period
- Up to 30 days
- After you receive notice of the right to cancel (HMRC)
- Right to withdraw (the alternative)
- 7 to 14 calendar days
- Before the ISA starts (HMRC)
- Effect on your allowance if cancelled in time
- None
- The subscription is treated as though never made
What is the cooling-off period for an ISA?
HMRC’s guidance “How to open an ISA as an ISA manager” says a provider must let you cancel your subscription within a set period after you have received notice of the right to cancel, and that this should be made clear in the account’s terms and conditions. The period cannot be more than 30 days after the notice has been received.
The FCA’s cancellation rules in COBS 15 set the specific period. For a cash deposit ISA, that is a 14 calendar day cancellation period. The clock starts from the day the contract is concluded or the day you receive the contractual terms and conditions, whichever is later, so it is not simply 14 days from the day you first applied.
Because the exact window sits in the provider’s terms, the only reliable figure is the one on your own account. Treat 14 days as the floor to look for on a cash ISA, and read the terms for the rest.
What happens to your ISA allowance if you cancel?
This is the point that matters most. HMRC’s guidance says that if you cancel within the cancellation period, you are treated as though you have not subscribed to an ISA, and the provider should tell you that the cancelled subscription does not count as a subscription to an ISA. Only once the cancellation period has passed does the cancelled subscription count, and the provider then has to include it on its annual return to HMRC.
A round-number example shows why the timing is worth getting right. Say you pay £10,000 into a new Cash ISA and change your mind two days later.
- Cancel inside the cooling-off period. HMRC treats it as though you never subscribed. Your full £20,000 allowance for the year is intact, and you can pay the £10,000 into a different ISA instead.
- Close the account after the period. The £10,000 has used that much of your allowance. Taking it back out of an ordinary ISA does not give the allowance back, so you cannot re-use it later in the year.
The one exception to that second case is a flexible ISA, where money you withdraw can be replaced in the same tax year without using fresh allowance. Cancelling, though, is cleaner: it unwinds the subscription altogether. If you are worried you have paid in more than the rules allow, see what happens if you pay too much into an ISA.
Is it cancellation, or a right to withdraw before the ISA starts?
HMRC’s guidance describes a second option a provider can offer instead of a right to cancel: a pre-contractual right to withdraw. This lasts 7 to 14 calendar days from when the provider receives your application, and the ISA can only begin once that period has expired.
The practical difference is simple. With a right to cancel, the ISA has already started and you are unwinding it. With a right to withdraw, the ISA has not started yet, so there is nothing to unwind. HMRC says investors who use the right to withdraw are free to subscribe to another ISA in the same tax year, and because a cancelled subscription is treated as though it was never made, the same holds after a cancellation. When you open an account, check how to open an ISA and look in the welcome information for which of the two rights your provider gives.
Can you cancel an ISA transfer that is already under way?
A transfer is where the two rights really diverge, and it is the question most people are asking. HMRC’s transfer guidance for managers, under the heading “Cancellation of a transfer”, sets out what happens.
If your new provider offers a right to withdraw, HMRC says it should not forward the transfer request to your old provider until that withdrawal period has ended. So during that window the money has not moved: it is still sitting in your old ISA, and pulling out is straightforward. If your new provider instead offers a right to cancel, the transfer completes first, and you can then cancel the new ISA.
Two things are worth holding on to. First, a transfer is not a new subscription: HMRC says investments and cash that are transferred do not count towards your overall ISA allowance, so an unwound transfer does not cost you allowance either way. Second, once a transfer has fully completed there is no guarantee you can reverse it, and you may have to transfer again to move back. The safe move is to tell your new provider the moment you change your mind, and to check its terms. If a transfer has simply stalled rather than gone wrong, read our guide to an ISA transfer that is not showing, which covers the 15 business day cash-to-cash timetable and when to complain.
What if the cooling-off period has already passed?
Once the window has closed you cannot cancel, but you still have choices. You can close the account or move the money, as long as you accept the consequences.
Closing an ordinary ISA and taking the cash does not hand back the allowance you have used, as the example above shows. If the aim is to get a better deal, transfer rather than withdraw, so the money keeps its tax-free status: see how ISA transfers work. A fixed-rate account may apply a charge for taking money out before the term ends, and that charge is set by the provider, so check the terms before you act. An ISA does not have to be touched at all if you are happy with it, because an ISA does not expire while the money stays inside the wrapper.
Does cancelling differ for a Lifetime or stocks and shares ISA?
The broad shape is the same: a right to cancel or a right to withdraw, set out in the terms, with a cancelled subscription treated as though it was never made. The details differ by product, and the FCA’s rules treat a Lifetime ISA differently from a cash deposit ISA, so the exact period and which of the two rights applies is a matter for your provider’s terms.
One point is worth drawing out for a Lifetime ISA. A Lifetime ISA has its own rules, including the government bonus, the first-home conditions and a charge for taking money out for other reasons. Those sit alongside the cooling-off right rather than replacing it, and because a cancelled subscription is treated as though it was never made, cooling off is not the same as making a withdrawal. If you are weighing up a Lifetime ISA, the Lifetime ISA withdrawal charge is the figure to understand first.
Questions people ask
Can you cancel an ISA transfer?
Often yes, if you act quickly. If your new provider gives a right to withdraw before the ISA starts, HMRC says it should not forward the transfer request to your old provider until that period ends, so the money stays in the old ISA. If your new provider gives a cancellation right, the transfer completes first and you can then cancel. Once a transfer has fully completed there is no guarantee, so tell your new provider as soon as you change your mind and check its terms.
How long is the cooling-off period on an ISA?
The FCA's cancellation rules set a 14 calendar day cancellation period for a cash deposit ISA. HMRC's guidance for ISA managers says the period is set out in the account's terms and conditions and can be up to 30 days after you receive notice of the right to cancel. Some providers instead offer a right to withdraw of 7 to 14 calendar days before the ISA starts. Your provider's terms set the actual window, so check them.
Does cancelling an ISA use up my allowance?
No, if you cancel in time. HMRC's guidance says an investor who cancels within the cooling-off period is treated as though they have not subscribed to an ISA, so the cancelled subscription does not count against your allowance. Only after the cancellation period does the subscription count. See what happens if you pay in too much.
What happens if the cooling-off period has already passed?
You can no longer cancel, but you can still close the account or move the money. Taking money out of an ordinary (non-flexible) ISA still uses the allowance you have already paid in. If you want to move to a better account, transfer rather than withdraw, so you keep the tax wrapper. A fixed-rate account may charge for early access. See how ISA transfers work.
Can I open another ISA after cancelling one?
Yes. HMRC says investors who use a right to withdraw are free to subscribe to another ISA in the same tax year, and because a cancelled subscription is treated as though it was never made, the same applies after a cancellation. Check the account is actually cancelled, not just emptied, before paying into a new one.
