Last updated: 14 October 2026
Should you use up this year’s cash ISA allowance?
If you have savings that could earn taxable interest, it usually makes sense to use your ISA allowance before 5 April, because any unused allowance is lost at the end of the tax year. For 2026/27, you can save up to £20,000 across all your ISAs, and all of it can go into a cash ISA. From 6 April 2027, the cash ISA limit falls to £12,000 for people under 65, though the overall £20,000 limit stays. That makes 2026/27 the last year under-65s can put the full £20,000 into cash.
ISA limits
| ISA type | 2026/27 | From 6 April 2027 |
| Overall ISA limit | £20,000 | £20,000 |
| Cash ISA, under 65 | Up to £20,000 | Up to £12,000 |
| Cash ISA, 65 and over | Up to £20,000 | Up to £20,000 |
| Lifetime ISA | £4,000 (counts towards £20,000) | £4,000 |
| Junior ISA | £9,000 | £9,000 |
Do you need an ISA?
The Personal Savings Allowance already lets you earn interest tax-free: £1,000 a year for basic-rate taxpayers, £500 for higher-rate taxpayers and nothing for additional-rate taxpayers. If your interest is below these amounts, an ISA gives no immediate saving. But ISA savings stay tax-free every year, and with savings tax rates rising to 22%, 42% and 47% from April 2027, ISAs become more valuable.
Example
Chloe, a higher-rate taxpayer, has £40,000 in a savings account at 4%, earning £1,600 a year. After her £500 allowance, £1,100 is taxed at 40%, so she pays £440. If she moves £20,000 into a cash ISA in 2026/27, her taxable interest falls to £300, saving £320 a year. Next year, she can move another £12,000 into a cash ISA, or £20,000 if she uses stocks and shares for the rest.
Transfers don’t count
Moving existing ISA money between providers doesn’t use your allowance, as long as you use a proper transfer. Withdrawing and redepositing does use it, unless your ISA is flexible.
Couples
Each person has their own £20,000 allowance, so a couple can shelter £40,000 a year. A spouse with lower income may also be able to hold savings outside an ISA with less tax.
Cash vs stocks and shares
Cash ISAs protect your capital but can lose value against inflation. Stocks and shares ISAs carry investment risk but can grow more over the long term. From April 2027, new rules will stop people using stocks and shares ISAs to hold large amounts of cash.
Timing your payment
Payments must reach the ISA provider by 5 April. Some providers stop taking deposits a few days earlier, especially for new accounts, so don’t leave it to the last day.
Frequently asked questions
Can I open more than one cash ISA a year?
Yes, since April 2024, as long as you stay within the limits.
Is ISA interest reported to HMRC?
No, it’s tax-free and doesn’t go on a tax return.
What happens to my ISA when I die?
It can keep its tax-free status during the administration of the estate.
Can I still pay in after moving abroad?
Not usually, once you’re non-UK resident.
Related: billions paid into cash ISAs, continuing to pay into UK ISAs and savings interest and your tax code.
Talk to Accotax
Want this handled for you? Our team at Accotax can help with ISA and savings planning. See our small business accountants service, or contact us for a free, no-obligation quote.
This page is general guidance based on HMRC rules for the 2026/27 tax year, checked against gov.uk on 14 October 2026. It is not personal advice, so speak to an accountant about your own situation.
