By Emma Gunn for Thisismoney.co.uk

Published: 07:44 BST, 18 February 2019 | Updated: 14:29 BST, 18 February 2019

I am moving to Australia in June this year with family, what will happen to my Isa?

I have around £40,000 in cash and £75,000 in my stocks and shares Isa – will I have to close the accounts and withdraw the money when I move? 

I am concerned that if I keep them I will be taxed? 

Expat money: Your cash and investment Isas will remain tax free in the UK after you have moved abroad

Emma Gunn of This is Money says : When you move abroad there are a whole host of things you need to think about, including unfortunately the implications for any tax-free savings you have built up in the UK.

What you want to do with these will depend on whether you still have any assets in the UK, whether you plan to move back and factors such as the exchange rate and tax rules in the country you are moving to.

For example, those considering returning to the UK at some point may want to leave their money where it is in order to avoid losing any value through the exchange rate. 

Many expats also consider keeping some cash in the UK if they still have financial responsibilities to balance in the UK such as a home and mortgage.

While your plans may affect what you want to do with the money, to help you in the meantime we spoke to some experts to find out what the rules are.

Anna Bowes, co-founder of Savings Champion, says:  You are only eligible to open and fund an Isa if you are resident in the UK or if you are a Crown servant (for example in the diplomatic or overseas civil service) or their spouse or civil partner.

If you move abroad you can no longer add any further money to your Isa but you are allowed to retain it and will continue to benefit from preferential tax treatment in the UK - in other words, there is no liability for income or capital gains tax. 

However, depending on where you move to, you may need to pay tax on the returns in your new country of residence.

If you return and become a UK resident again, you can then add further funds to your Isa.

If you move abroad, you should tell your Isa provider as soon as possible and it could be possible that some providers may require you to close all accounts with them. So while in theory you should be able to retain your Isa, check with your individual provider before you make the move.

Emma Gunn of This is Money continues:  According to the Gov.uk website you do have a bit of leeway on when you will no longer be allowed to fund your accounts.

It specifies that you have until the end of the tax year that you move away to add money to your tax-free pot. This is because you will continue to be a tax resident in the UK until the end of the tax year.

In your case that means you can still max out the 2018-19 limit of £20,000 if you have not done so already, and you can contribute to your Isa allowance in the next tax year too – as you are not due to move until June.

Australian adventure: You won't be able to transfer your Isa once you leave the UK

After you have made the move you will be able to keep the account open as Bowes explains, and the money or investments inside will continue to be shielded from income and capital gains tax in the UK.

Make sure to move your Isa to the best deal before you leave though.

While you can keep accounts open you might not be able to transfer your cash Isa pot to another account once you have left the UK.

One of the drawbacks of this will be that you may end up losing out on interest if the rate becomes uncompetitive, for example if a temporary bonus ends or at the end of a fixed-rate deal.

While you may be allowed to transfer your balance under HM Revenue and Customs rules, most banks won’t accept new accounts if you are not a UK resident any more, even if you are moving an existing balance from an old Isa.

This means before you leave if you plan on keeping your Isa open you ought to ensure that your cash is benefiting from the best rate possible first.

When it comes to stocks and shares Isas, the same rules apply in that you won’t be able to add to your account or move your investments to a different provider once you have upped sticks from the UK.

However you will still be able to manage your investments and change them if you wish through your investing platform. 

Therefore before you jet off to your new life in sunnier climes make sure to review the fees and charges on the account and ensure your investments are in the best hands.

Danny Cox, head of communications at Hargreaves Lansdown, adds : Managing your Isas from abroad is easier if you have online access or in the case of stocks and shares Isa, hold them with an online investment service.

If you are drawing income from your Isas this will usually be paid into a UK bank account in pounds sterling.

For more expat articles visit This is Money's new expat section, expat money.

If you have any question you wish to be answered as part of the section, send an email with the subject line 'expat' to editor@thisismoney.co.uk.

Moving this money to the currency of your new jurisdiction is usually more cheaply done through a specialist currency broker rather than a bank.

There is also the risk that when sterling falls in value relative to other currencies, your money goes less far. The risk of the exchange rate operating against you can have a significant bearing on income such as pensions paid in sterling. You can fix exchange rates up to two years in advance which helps to reduce this risk.

Up until you move abroad you can continue to save into tax shelters such as Isa and Sipp. You need to consider carefully the timing of when you move abroad, and more importantly, when you move back. Your tax residency normally applies for a full tax year even if you physically are not present for the whole of that year.

Emma Gunn of This is Money continues: Unfortunately while the money you hold in your Isa will remain tax free, you may be taxed on the interest and returns earned. 

The rules will of course depend on where you are moving to.  

Australia has a double taxation agreement with the UK that means that you won't pay tax twice, but of course your Isa income won't be taxed in the UK and you will have to declare any returns or interest as part of your income to the Australian authorities.   

You can find out more on from the Australian Taxation Office.

 Ammo Kambo, financial planner at Brewin Dolphin, says:   The Isa funds could be subject to local, overseas taxation. 

As part of their planning, individuals should check what tax could apply to their UK savings and investments in the new country of residence and also when they come to take money out of them. 

They must also notify their Isa provider as soon as they cease being a UK resident.

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