Every ISA a US person holds is a financial account at a UK institution, and the US treats it like any other. A cash ISA, a stocks and shares ISA, a Lifetime ISA and an Innovative Finance ISA each count towards the $10,000 aggregate test for the FBAR (opens the official FinCEN page in a new tab), each is listed separately at its maximum value, and each goes on Form 8938 (opens the official IRS page in a new tab) once that form's higher threshold is met. The UK tax-free status of the wrapper plays no part in either report.
This post is for US citizens and green card holders in Britain who have opened one or more ISAs and want to know how to report them. It extends our guide to FBAR and FATCA for UK residents on one question: how each type of ISA is listed, valued and identified. It covers the institution to name, the value to use, what happens to the funds inside a stocks and shares ISA, and how the Lifetime ISA bonus and withdrawal charge look from the US side. Children's accounts are covered in our post on Premium Bonds, Junior ISAs and the IRS.
Is an ISA a foreign financial account for the FBAR
Yes. FinCEN's instructions define a financial account to include savings, deposit, securities and brokerage accounts maintained with a financial institution, and a foreign financial account as one located outside the United States. An ISA held with a UK bank, building society or investment platform fits that definition.
The IRS page on the FBAR (opens the official IRS page in a new tab) adds a point that matters for ISAs in particular: whether an account produced taxable income has no effect on whether it is a foreign financial account. A cash ISA earning interest the UK never taxes is still an account. The wrapper is a UK tax rule about what HMRC charges, and it says nothing about what the United States counts.
The UK offers four types of Individual Savings Account (opens the official GOV.UK page in a new tab): cash, stocks and shares, innovative finance and Lifetime. Each one you hold is its own account with its own provider and its own reference, so each is listed on its own line. Two cash ISAs with two banks are two accounts, and an ISA on the same platform as a dealing account is a separate entry.
- Cash ISA: reported as a bank account with the bank or building society that runs it
- Stocks and shares ISA: reported as a securities account with the platform or manager
- Lifetime ISA: reported as cash or securities, depending on what it holds
- Innovative Finance ISA: reported with the ISA manager, on the cautious reading
Which institution and value go on the report for each ISA
The institution is the firm that maintains the ISA, which is the bank, building society, platform or ISA manager named on your statements. The value is the highest value of the account during the calendar year, taken from your statements and converted to dollars at the Treasury rate for the last day of the year.
For each account the FinCEN line instructions ask for the maximum value, the type of account, the full name of the financial institution, the account number and the institution's mailing address. The type is Bank, Securities or Other. A cash ISA is a bank account. A stocks and shares ISA is a securities account. Where a platform runs your ISA through a separate nominee or custody company, the name to use is the firm that maintains the account and issues your statements. The FinCEN Form 114 page on this site sets out the report itself.
The maximum value is a reasonable approximation of the greatest value of the cash and investments in the account during the year, and periodic statements may be relied on if they fairly reflect it. A stocks and shares ISA moves daily, so a downloaded valuation history is better than a quarterly statement. Our post on the FBAR maximum value and exchange rate works through the conversion step by step.
How does a stocks and shares ISA appear on Form 8938
As one account, not as a list of funds. The Form 8938 instructions say that if you have an interest in a financial account that holds specified foreign financial assets, you do not have to report the assets held in the account. The ISA is listed once, at its maximum value, with the platform as the institution.
Form 8938 is only due once your specified foreign financial assets pass the threshold that applies to you. For tax year 2025, a US person living abroad and not filing jointly files when the total exceeds $200,000 at year end or $300,000 at any time, and a married couple abroad filing jointly when it exceeds $400,000 at year end or $600,000 at any time. Someone living in the US and not filing jointly files at $50,000 at year end or $75,000 at any time. The IRS tool Do I need to file Form 8938 (opens the official IRS page in a new tab) sets out who counts as living abroad. Our page on Form 8938 explains the form, and the IRS comparison of Form 8938 and FBAR requirements (opens the official IRS page in a new tab) confirms that filing one never satisfies the other.
In Part V you give the account type, the account number, the maximum value, the institution's name and address, and tick boxes for an account opened or closed during the year. Dividends, interest and gains from the ISA are summarised in Part III and taxed on the return itself. The instructions also say a person with no income tax return to file has no Form 8938 to file, while the FBAR has no such exception.
Why the funds inside an ISA are a separate question
Because the FBAR and Form 8938 report accounts, while the funds inside a stocks and shares ISA are taxed under their own rules. UK and Irish funds are commonly passive foreign investment companies, which bring Form 8621 and a harsh default regime. Neither report deals with that, and the ISA wrapper gives no US protection from it.
We set out the fund problem in why your stocks and shares ISA worries the IRS and do not repeat it here. The practical link between the two is the data. The valuation history you pull together for the FBAR maximum value is also the starting point for each fund's Form 8621, and a switch between funds inside the ISA shows on the statements you are already reading. Individual company shares held in an ISA are usually not PFICs, though a foreign company that is mostly passive can be one.
Our PFIC reporting service prepares the fund calculations from the same schedule of accounts that feeds the FBAR.
How the Lifetime ISA bonus and withdrawal charge are treated
For the FBAR and Form 8938, a Lifetime ISA is an account like the others, and its value includes any government bonus already paid into it. The UK rules on the bonus and the withdrawal charge change what you can take out, not whether the account is reported.
GOV.UK explains the Lifetime ISA (opens the official GOV.UK page in a new tab) rules. You must be at least 18 and under 40 to open one, and you can pay in until you are 50. The government adds a bonus on what you pay in, up to an annual cap. You can withdraw without a charge to buy a first home within the scheme's conditions, from age 60, or if you are terminally ill. Any other withdrawal, or a transfer to another type of ISA before 60, is an unauthorised withdrawal and carries a charge that recovers the government bonus and is applied to the whole amount you take out.
On the US side, we report the balance shown on the statements, including any bonus credited, and we do not reduce the maximum value for a charge that has not been made. The IRS has published nothing on the Lifetime ISA by name, so how the bonus, the growth and any charge are treated on the return is a question we look at on the facts of each case rather than a settled rule.
- Bonus credited to the account: part of the account's value for both reports
- Withdrawal charge not yet incurred: not deducted from the maximum value
- Withdrawal with a charge: the account is still reported for that year
- Lifetime ISA holding funds: the fund question in the section above still applies
What about Innovative Finance ISAs and moving an ISA
An Innovative Finance ISA holds peer-to-peer loans, crowdfunding debentures and certain other investments through an ISA manager. FinCEN has not addressed these accounts by name. We report them with the ISA manager as the institution, because the money sits in an account that a firm maintains for you.
GOV.UK's list of how ISAs work (opens the official GOV.UK page in a new tab) now includes cryptoasset exchange traded notes among the investments an Innovative Finance ISA can hold. Those notes are securities, and the account that holds them is reported in the usual way.
Moving an ISA to a new provider is done through the new provider's transfer process. For US purposes the old account and the new one are usually two accounts in that year, each listed at its own maximum value, and the same money can be counted in both. Our post on closing a UK account during the year explains why that double counting is expected.
A worked example with three ISAs
Take a US citizen employed as a nurse in Leeds, filing separately from her British husband. She holds a cash ISA with a building society, a stocks and shares ISA on an investment platform, and a Lifetime ISA with a third provider, alongside her current account.
For the FBAR she finds the highest value of each of the four accounts during the calendar year, converts each at the Treasury year-end rate, and adds them. If the total exceeds $10,000, she files one FBAR listing all four, each with its own institution and account number, by 15 April, extended automatically to 15 October. The cash ISA is a bank account, the stocks and shares ISA a securities account, and the Lifetime ISA either type depending on what it holds.
For Form 8938 she compares the same total with $200,000 at year end or $300,000 at any time. If she is under it, there is no Form 8938, though the interest and dividends still go on her return and she answers Yes to the foreign account question on Schedule B. HMRC's exchange of information guidance lists ISAs among excluded accounts, so her providers may never report them for the IRS to see, and her own reports may be the only record. We prepare all of it through our foreign income and FBAR reporting service alongside individual tax return preparation, and the wider rules are in our guide to FBAR and FATCA for UK residents.
General information, not advice. The right answer depends on your circumstances and the tax year concerned.
