richfool wrote:OK, noted, though from what Pochisoldi said (copy below), the spouse has that full APS allowance (equal to the balance of the deceased's ISA at DoD), even if some of the ISA balance is passed to the children. She can thus add other funds to her ISA (cash or equity ISA) up to the limit of the APS.
The APS transfer can be made in cash or in-specie. The value is set at the point administration of the estate is finalised (or three years after death - see genou's point).
According to the article I just referred to:
https://techzone.abrdn.com/public/inves ... S#anchor_6The APS is independent of the assets held within the ISA. Even if the assets aren’t inherited by the spouse or civil partner, they can still apply for the APS and make contributions from their own assets.So, yes, theoretically children can inherit the assets from the ISA independently of the APS. My guess is they use up the IHT allowance, however, so an APS of £100k goes to the spouse with no IHT implication and £100k worth of assets could go elsewhere, but they would be subject to IHT (or at least count against the overall IHT allowance of the combined estate on second death). The assets inherited by the offspring would also be outside the ISA wrapper at this point.
You'd need someone with appropriate qualifications and experience to check these points. I also suspect you might have some fun and games with the ISA provider if you want to do something creative like this, especially discount brokers of the kind many of us on these boards favour.