Overview
“Tax-free” and “free to use” are different things. A stocks and shares ISA can protect investment income and gains from UK tax while still charging you for the account, the investments inside it and the transactions you make.
The difficulty is that the costs are not always collected in the same place. Some appear as cash deductions. Others reduce the value or return of the fund before you see it. Comparing only the headline platform fee misses part of the bill.
Quick Answer (Read This First)
Compare the annual cost of your actual portfolio, in pounds, across platform fees, dealing charges, fund costs and any other relevant charges. Use the same balance, holdings and transaction pattern for each provider.
A percentage fee can be economical for a small account. A flat fee can become more competitive as the balance grows. Caps, minimum charges and different treatment of funds and ETFs can change that calculation substantially.
If you are still deciding whether investing suits the money's purpose, start with stocks and shares ISA basics. A cheaper account does not remove investment risk.
The Main Charges, Separated
| Cost | What it pays for | How to compare it |
|---|---|---|
| Platform or account fee | Administration and holding investments | Annual percentage, flat subscription, minimums, tiers and caps |
| Dealing charge | Buying or selling an investment | Cost per trade, including regular-investing exceptions |
| Fund ongoing charge | Operating and managing the fund | Ongoing charges figure for the exact fund and share class |
| Fund transaction costs | Trading carried out inside the fund | Separate fund cost disclosure; do not assume the OCF includes everything |
| Foreign-exchange charge | Converting currency for relevant transactions | Percentage and any minimum charge |
| Other costs | Transfers, telephone dealing, advice or service extras | The provider's full tariff and your service choices |
There may also be a bid-offer spread: the difference between buying and selling prices. Relevant taxes on transactions can still apply inside an ISA. An ISA's income and gains exemptions are not a promise that every purchase is free of tax or cost.
MoneyHelper's ISA guidance explains the wrapper, while a provider's tariff and the fund's own documents explain what you will pay.
Platform Fees and Fund Fees Are Usually Separate
If a platform charges 0.25% a year and the chosen fund has an ongoing charge of 0.20%, that is roughly 0.45% before additional costs, assuming both apply to the same unchanged balance.
On £20,000, the illustrative amounts are £50 for the platform and £40 within the fund: £90 altogether. It would be misleading to describe the whole arrangement as costing £50 simply because that is the platform's visible deduction.
Fund charges are generally reflected within the investment's value. You do not normally receive a separate monthly invoice for the OCF, but the cost still affects the return you keep. Check the annual costs statement as well as the account's cash transactions.
For several funds, calculate each holding separately. Applying the cheapest fund's fee to the whole portfolio understates the cost if other holdings charge more.
A Worked Comparison in Pounds
These are invented tariffs to demonstrate the calculation, not quotes from named providers. Assume a £20,000 balance held unchanged for a year, one fund with a 0.20% ongoing charge, and 12 purchases at the stated dealing charge. Ignore investment movements, fund transaction costs, spreads and any other charges for this illustration.
| Annual cost | Percentage platform | Flat-fee platform |
|---|---|---|
| Platform fee | 0.25% × £20,000 = £50 | £5 × 12 = £60 |
| Fund ongoing charge | 0.20% × £20,000 = £40 | 0.20% × £20,000 = £40 |
| Twelve purchases | £1.50 × 12 = £18 | £0 × 12 = £0 |
| Illustrative total | £108 | £100 |
At a £5,000 unchanged balance, those same assumptions produce £40.50 for the percentage platform and £70 for the flat-fee platform. The provider that was cheaper at £20,000 is now dearer.
If the percentage provider makes those regular purchases free, its £20,000 total falls to £90. One tariff detail reverses the original result. In a real account, contributions and market movements also change the balance used to calculate fees.
Why Funds and ETFs Can Produce Different Platform Bills
Some providers cap the custody charge for shares, ETFs and investment trusts while applying a different schedule to funds. “ETF” may therefore appear within a platform's shares tariff even though it is itself a type of fund.
As checked on 13 September 2026, AJ Bell's published ISA tariff distinguishes shares and funds, caps the shares account charge, and makes eligible regular investing free. This is an illustration of what to look for, not a recommendation or a complete comparison of providers.
Do not assume a cap applies to the entire ISA. If you hold both funds and ETFs, work out the treatment of each portion. Also compare the investments themselves: a change of structure may introduce spreads or dealing costs and may not provide identical exposure.
Read Minimums, Tiers and Payment Rules
A headline percentage does not always apply uniformly. A minimum annual charge can dominate a small account. A tiered charge can apply one rate to the first slice of assets and another to the next, rather than reducing the fee on the whole balance.
Hargreaves Lansdown's ISA charges page explains tiering and how unpaid account charges may be covered by selling investments. Check how your own provider collects fees and whether cash must be left available.
When comparing, write down three numbers: the likely cost at your current balance, at a smaller balance, and after planned contributions. That makes minimums and caps much easier to spot than a list of percentages.
Before Transferring to Save Money
Ask the receiving provider whether it accepts your exact holdings, whether they can move without being sold, and what transfer costs or trading restrictions apply. A cash transfer can leave you out of the market while the money moves; an in-specie transfer moves investments where supported.
Use the formal ISA-transfer process to preserve the wrapper. Withdrawing into your bank account and paying into a new ISA can turn the transaction into a fresh subscription instead. See ISA transfer mistakes and GOV.UK's transfer guidance.
For a simple payback check, divide any one-off switching cost by the expected annual saving. An illustrative £60 cost and £24 yearly saving take two and a half years to recover, assuming nothing else changes. Balance that against investment choice, service and how soon you expect to use the money.
Frequently Asked Questions
Browse the savings guides for related decisions. Investments can fall in value and you may get back less than you invest. This is general information, not a personal investment recommendation. Sources checked on 13 September 2026.
