Every April, millions of savers ask the same thing: how much can I put in an ISA this year, and does it matter which type? Get it wrong and you either pay tax you did not need to, or waste an allowance you can never get back.
This guide explains the 2026/27 ISA allowance in plain English, with the official rules linked at each step. You will see how the £20,000 splits, what a Lifetime ISA adds, and how the cash ISA cut from April 2027 changes your plans.
Every figure here comes straight from GOV.UK or HMRC.
What is the ISA allowance for 2026/27?
The ISA allowance for the 2026/27 tax year is £20,000. The ISA tax year runs from 6 April 2026 to 5 April 2027. On 6 April 2027, a fresh allowance starts.
Two rules surprise people:
- Use it or lose it. Unused allowance does not roll over. If you only pay in £8,000 this year, the other £12,000 is gone for good.
- It is per person. A couple can shelter £40,000 a year between them.
Our ISA allowance rule page keeps the current figure, its source and the date we last checked it.
How can I split my annual ISA allowance?
There are four main types, and the 20000 ISA allowance covers all of them combined:
| ISA type | Most you can pay in for 2026/27 | Good for |
|---|---|---|
| Cash ISA | £20,000 | Emergency money, short-term goals |
| Stocks and shares ISA | £20,000 | Investing for five years or more |
| Innovative finance ISA | £20,000 | Peer-to-peer lending (higher risk) |
| Lifetime ISA | £4,000 | A first home, or later life from 60 |
| All ISAs together | £20,000 |
Source: GOV.UK, How ISAs work, checked October 2026. The Lifetime ISA limit counts within the £20,000.
GOV.UK gives a neat example. You could save £10,000 in one cash ISA, £3,000 in another cash ISA and £7,000 in a stocks and shares ISA. Yes, you can now hold two cash ISAs in one year. Only the Lifetime ISA is limited to one a year.
Lifetime ISA limit and bonus
The Lifetime ISA limit is £4,000 a year. The government adds a 25% bonus, so £4,000 becomes £5,000. You must open one before you turn 40 and can pay in until 50.
Take the money out for anything other than a first home (up to £450,000), reaching 60 or terminal illness, and you pay a 25% charge. That charge claws back the bonus and a bit more, so treat it as locked away.
Cash ISA allowance: what changes in April 2027?
This is the big one. From 6 April 2027, the cash ISA allowance drops to £12,000 a year for anyone under 65. The overall ISA maximum amount stays at £20,000, so the other £8,000 can still go into stocks and shares or other ISAs.
HM Treasury set out the detail in a policy paper on the cash ISA limit, published on 17 September 2026. People aged 65 and over keep the full £20,000 for cash. Money already in a cash ISA stays tax-free.
What should you do before then? If you rely on cash ISAs, this 2026/27 tax year is your last chance to shelter a full £20,000 in cash under 65.
How popular are ISAs right now?
Very. HMRC's annual savings statistics, published on 16 September 2026, show:
- around 16.8 million adult ISA accounts were paid into in 2024/25
- around £135.7 billion was subscribed in total
- 64% of accounts paid into were cash ISAs, down slightly on the year before
Cash still dominates. That is exactly what the April 2027 change is meant to nudge.
"We also hope it will build greater confidence to invest. While investing will not be right for everyone, we know people in the UK invest less compared to the EU or US."
Sarah Pritchard, Deputy Chief Executive, Financial Conduct Authority, December 2025
Flexible ISA rules: taking money out and putting it back
Some providers offer a flexible ISA. With one, you can withdraw money and pay it back in the same tax year without using more of your allowance.
Here is how it works. Say you pay £20,000 into a flexible cash ISA in May, then take out £5,000 in August for a new boiler. You can put that £5,000 back before 5 April and it does not count again.
With a non-flexible ISA, that £5,000 is gone from your allowance once withdrawn. Check your provider's terms, usually under a heading like "Withdrawals" or "Flexible ISA", before you rely on it.
Do I even need an ISA for my savings?
Not always. Most people get some savings interest tax-free outside an ISA:
- basic rate taxpayers: £1,000 of interest a year
- higher rate taxpayers: £500
- additional rate taxpayers: nothing
That is the Personal Savings Allowance. At a 4% rate, £1,000 of interest is earned by about £25,000 of savings. So a basic rate taxpayer with £10,000 in an easy access account may pay no tax on it.
The ISA earns its keep as balances grow, as you move into a higher tax band, or when you invest. Gains and dividends inside an ISA are tax-free for life, and you never declare them.
A worked example: using the full 20000 ISA allowance
Here is an illustrative example, not a real household.
Priya is 34, a higher rate taxpayer, and has £30,000 to put away this year. She wants a deposit for a first flat in four years and a long-term investment pot.
- £4,000 into a Lifetime ISA, which becomes £5,000 with the bonus
- £6,000 into a cash ISA for her emergency fund
- £10,000 into a stocks and shares ISA for the long term
- £10,000 left over, kept in an easy access account and paid into ISAs next April
Her £500 Personal Savings Allowance covers the interest on the leftover £10,000 for now. Our emergency fund calculator shows how many months of spending her £6,000 covers.
Common mistakes with the ISA allowance
- Paying in the same money twice. Moving cash between your own ISAs must be done as a transfer. If you withdraw and redeposit with a non-flexible ISA, it counts again.
- Missing the 5 April deadline. Money paid on 6 April counts towards the next year. Many providers need payment a few days early.
- Breaking the Lifetime ISA rules. The 25% charge applies to the whole withdrawal, including your own money.
- Forgetting FSCS limits. Cash ISAs at one bank share the £120,000 deposit protection limit with your other accounts there. See our FSCS rule page.
- Holding long-term money in cash. Cash is safe from falls, not from inflation. Over 10 years or more, investing has historically done better, though values can fall.
How Plenence helps with your ISA allowance
Tell Plenence what you have paid into ISAs this tax year and its ranked decision list flags any unused ISA allowance before 5 April, with the rule and its source beside it. The £12,000 cash limit from April 2027 is already in its rules dataset. It shows the facts and the rule; the choice of account is yours.
Weighing up an ISA against a pension? Our ISA vs SIPP comparison walks through tax relief, access age and inheritance tax side by side.