Personal Equity Plans (PEPs)

A better home for your PEPs

What is a PEP?

PEPs were introduced in 1987 and were available for new investment until 1999. Initially there were 2 types of PEP: General and Single Company PEPs. General PEPs were designed to hold a range of investments, including funds and shares. With Single Company PEPs you could just buy the shares of a single company.

On 6 April 2008 PEPs became Stocks & Shares ISAs, preserving the investments within them.

As a result of the merger of PEPs into ISAs there was a small change to the way interest is paid on cash. HMRC levy a 20% charge on interest paid on cash held within a Stocks & Shares ISA.

You can transfer the ISAs you currently hold between managers preserving the benefits. This means that whatever type of PEP you originally bought, you can now invest pretty much wherever you like - in funds, shares, even cash - and your investments remain sheltered from tax.

Remember, tax rules can change and the value of any benefits will depend on your circumstances.

Why transfer PEPs to an ISA?

Whilst PEPs no longer exist, your old PEP wrappers can still be consolidated into a single ISA account and the investments you hold can be changed. Any ISA, including former PEPs, can be transferred between investment managers without losing the valuable tax benefits.

By transferring old PEPs and ISAs to Hargreaves Lansdown's Vantage Service you could save time and money.

• Receive savings of up to 0.5% per year on over 1,200 funds.
• Receive initial savings of up to 5.5% on over 2,400 funds if you switch your holdings.
• Choose from a wider range of investments including shares, gilts, corporate bonds and cash.
• Hold all your ISAs and old PEPs in one account, making them simple to manage.

Our service is designed for investors who like to choose their own investments, without advice. Remember, the value of investments can fall as well as rise so you could get back less than you invest.

Transferring your former PEPs to the Vantage Service is easy, but before you transfer please check you won't incur any exit fees and, if you are going to transfer as cash, remember you will be out of the market until the transfer is complete. If the market falls while you are holding cash this will work in your favour, but if the market rises you will not benefit from any gains until your money is reinvested.

Find out more about transferring