Submesoscale eddies in the ocean (0.1–10 km) are often missing from global climate models, yet they impact nutrient transport, sea ice coverage, and ocean overturning. Using submesoscale-resolving simulations, we show that these eddies near the sea ice edge impact air-sea heat fluxes, ice cover, and ocean heat storage in summer, and mixed layer depth in winter. These findings highlight the need to better represent submesoscale eddies in sea ice – covered regions of global climate models.