ISA Allowance 2026/27: Limits and Rules Explained

What is the ISA allowance for 2026/27?

The annual ISA allowance is the most you can pay into Individual Savings Accounts in one tax year. GOV.UK confirms the limit for the 2026 to 2027 tax year is £20,000. The tax year runs from 6 April to 5 April, so the current window closes on 5 April 2027.

To open an ISA you must be 18 or over and UK resident, or a Crown servant or member of the armed forces. The Lifetime ISA has its own age rules, covered below.

ISA limits by type

There are four ISA types for adults, plus the Junior ISA for children. The £20,000 is one combined limit, not £20,000 per type.

Source: GOV.UK ISA, Lifetime ISA and Junior ISA guidance; GOV.UK ISA reform 2027 factsheet (June 2026). Checked October 2026.

How splitting your allowance works

You can save the full £20,000 in one account, or spread it across several. Since April 2024 you can also pay into more than one ISA of the same type in the same tax year, according to Moneyfacts. GOV.UK gives the example of putting £10,000 into one cash ISA and £3,000 into another in the same year.

That means you could, for example, hold an easy-access cash ISA and a fixed-rate cash ISA side by side. Our guide to fixed vs easy-access savings explains the trade-off between access and rate.

A few limits apply when you split:

• The total is capped. All your adult ISA subscriptions in the tax year together cannot go above £20,000.
• One Lifetime ISA a year. GOV.UK says you can only pay into one Lifetime ISA in a tax year, up to £4,000.
• No joint ISAs. You cannot hold an ISA with someone else, so the allowance is per person. A couple can each use their own £20,000.

If you are weighing up where to put your money, see cash ISA vs stocks and shares ISA.

The cash ISA allowance change from April 2027

At the November 2025 Budget, the government announced a cut to the cash ISA allowance. A GOV.UK policy paper published on 17 September 2026 sets out the details:

• Start date: 6 April 2027, the first day of the 2027/28 tax year.
• Under 65: you can put a maximum of £12,000 a year into cash ISAs.
• 65 and over: you keep a £20,000 cash ISA limit. A GOV.UK factsheet from June 2026 says this applies from the start of the tax year in which you turn 65.
• Overall limit: the total ISA allowance stays at £20,000. An under-65 could put £12,000 in cash and the remaining £8,000 into stocks & shares or another non-cash ISA.
• Other limits: the factsheet says limits for innovative finance ISAs, Lifetime ISAs and stocks & shares ISAs stay the same.

The government also plans rules to stop people getting round the cash cap. From 6 April 2027, according to the June 2026 factsheet:

• Transfers from stocks & shares or innovative finance ISAs into cash ISAs will not be allowed for under-65s. Transfers from cash into stocks & shares will still be allowed.
• Interest paid on cash held inside a non-cash ISA will face a flat 22% charge, collected by the ISA provider and paid to HMRC.
• Money market funds will count as “cash-like” assets, and a non-cash ISA holding only those funds will no longer qualify.

What is confirmed and what is not: the £12,000 cap, the over-65 exemption and the 6 April 2027 start date are government policy. They are delivered by amending the ISA Regulations 1998, and the September 2026 policy paper describes this as a measure still to be legislated: it had not been enacted when the paper was published. Nothing changes for the 2026/27 tax year: until 5 April 2027 you can still put the full £20,000 into cash ISAs.

Lifetime ISA: £4,000 inside your £20,000

The Lifetime ISA (LISA) is for a first home or later life. GOV.UK’s LISA guidance, last updated in November 2024, sets out the rules:

• You must make your first payment before you turn 40, and you can keep paying in until 50.
• You can pay in up to £4,000 a year. This counts toward your £20,000 limit.
• The government adds a 25% bonus, up to £1,000 a year.
• You can withdraw without a charge to buy your first home costing £450,000 or less, from age 60, or if you are terminally ill with less than 12 months to live.
• Any other withdrawal carries a 25% charge.

The LISA may be replaced. In a 2026 consultation, which closed on 18 August 2026, HM Treasury proposed a First Time Buyer ISA to be offered in place of the LISA. It would be open to anyone 18 or over, with no upper age limit. Its limit and bonus rate have not been set. Existing LISAs would carry on under current rules, and new LISAs can still be opened until the new account launches.

Junior ISA allowance

The Junior ISA limit for 2026/27 is £9,000, according to GOV.UK. The child must be under 18 and living in the UK. They can take control of the account at 16 and withdraw money at 18.

Key ISA rules: flexible ISAs, transfers and carry-over

Unused allowance does not roll over

Any allowance you don’t use by 5 April is lost. Moneyfacts confirms you can’t carry the outstanding amount into the next tax year. Each new tax year starts with a fresh allowance.

Withdrawals and flexible ISAs

GOV.UK says you can take money out of an ISA at any time without losing the tax benefits, though your provider may have its own terms or charges. Normally, money you withdraw still counts toward that year’s allowance.

A flexible ISA is different. You can take cash out and put it back in the same tax year without it reducing your allowance. GOV.UK’s example: you pay in £10,000, then withdraw £3,000. With a flexible ISA you can still pay in £13,000 that year. With a non-flexible ISA you can only pay in £10,000 more. Not every ISA is flexible, so check the account terms.

Transfers don’t use your allowance

Moving an existing ISA to a new provider does not count toward your allowance, as long as you use the transfer process. GOV.UK says to ask the new provider for its transfer form. If you withdraw the money and pay it in yourself, you lose that part of your tax-free allowance.

• You can transfer all or part of your savings.
• You can move to the same type of ISA or a different type. From April 2027, the transfer limits described above apply.
• Cash ISA transfers should take no more than 15 working days. Other transfers should take no more than 30 calendar days. If there are delays, you can complain to the Financial Ombudsman Service.

If your spouse or civil partner dies

A surviving spouse or civil partner can get an additional permitted subscription (APS). This is an extra allowance equal to the higher of the deceased’s ISA value at the date of death or when it stopped being a continuing account of a deceased investor, on top of the survivor’s own £20,000. HMRC guidance (updated April 2024) says cash can usually be paid in within three years of the death, or 180 days after the estate is settled if that is later.

Do you need an ISA? The Personal Savings Allowance

Many savers already pay no tax on interest outside an ISA. GOV.UK sets the Personal Savings Allowance (PSA) for each tax year as:

Source: GOV.UK – Tax on savings interest: how much is tax-free (updated September 2026).

There is also a starting rate for savings. If your other taxable income is below £17,570, you can earn up to £5,000 of interest tax-free.

Interest above these allowances is taxed. From April 2027, tax on savings income rises by 2 percentage points to 22%, 42% and 47%, according to GOV.UK. The PSA and starting rate are not changing. An ISA matters most if your interest is likely to go above your PSA, or if you are a higher or additional-rate taxpayer. If you are still building a cash buffer, our guide to how much emergency fund you need may help.

Current cash ISA rates

MSE’s best-buy table, updated 2 October 2026 (checked October 2026), listed:

• Easy access: Plum at 4.6% AER, which includes a 2.06% bonus for one year. Transfers in earn a lower 3.75%.
• 1-year fix: Shawbrook Bank at 4.94% AER, minimum £1,000, with a 90-day interest penalty for early access.
• 2-year fix: Shawbrook Bank at 5.06% AER, minimum £1,000, with a 180-day interest penalty.

Rates change often, so check the latest figures before you open an account. For a wider view, see our UK savings accounts and ISAs guide, or our investments hub if you are considering a stocks & shares ISA.

Frequently Asked Questions

Sources

• GOV.UK – Individual Savings Accounts: overview (updated 30 Sep 2026)
• GOV.UK – How ISAs work
• GOV.UK – Withdrawing your money (flexible ISAs)
• GOV.UK – Transferring your ISA
• GOV.UK – Cash ISA limit reduction policy paper (17 Sep 2026)
• GOV.UK – ISA reform 2027: anti-circumvention rules factsheet (23 Jun 2026)
• GOV.UK – Lifetime ISA (updated Nov 2024)
• GOV.UK – Withdrawing money from your Lifetime ISA (updated Nov 2024)
• HM Treasury – First Time Buyer ISA consultation (2026)
• GOV.UK – Junior ISAs (updated 30 Sep 2026)
• HMRC – Manage additional permitted subscriptions (Apr 2024)
• GOV.UK – Tax on savings interest: how much is tax-free (30 Sep 2026)
• GOV.UK – Changes to tax rates for property, savings & dividend income (26 Nov 2025)
• Moneyfacts – ISA Allowance 2026/27 Explained (1 Jul 2026)
• MoneySavingExpert – Best cash ISAs (2 Oct 2026)

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