What is the UK ISA allowance for 2026/27?

£20,000 per individual per tax year, frozen at this level since 2017/18 (longest frozen period in ISA history). Confirmed frozen through at least April 2031 (extended at Autumn Budget 2025) by Autumn Budget 2024. The £20,000 can be split across any combination of Cash ISA, Stocks & Shares ISA, Innovative Finance ISA and Lifetime ISA, subject to the £4,000 sub-limit on LISA. Junior ISAs have a SEPARATE £9,000 allowance per child per year that doesn't count toward the adult limit. The "British ISA" additional £5,000 for UK shares only (proposed Spring Budget 2024) was SCRAPPED by Labour in Autumn Budget 2024 - the original £20k structure remains unchanged.

Can I have multiple ISAs of the same type in one tax year?

Yes since April 2024. The ISA Bill 2024 removed the previous one-Cash-ISA-and-one-S&S-ISA-per-year restriction. From 6 April 2024 onwards a saver can open and contribute to multiple Cash ISAs AND multiple S&S ISAs in the same tax year, subject to the overall £20,000 allowance. Lifetime ISA still has its own quirks - max one LISA per year and the £4,000 sub-limit applies. Innovative Finance ISA also still limited to one per year due to P2P platform mechanics. The multi-ISA change opens up opportunities to chase best-buy interest rates across multiple Cash ISA providers within a year without losing allowance.

What is the Lifetime ISA (LISA)?

A LISA allows up to £4,000 of contributions per year between ages 18 and 50. The Government adds a 25% bonus on contributions (up to £1,000 per year), payable monthly. LISA funds can be withdrawn penalty-free for a first home purchase up to £450,000, or from age 60. Withdrawals for any other reason before age 60 attract a 25% government penalty - which actually amounts to a 6.25% net loss on the contribution (because 25% bonus on £4,000 = £5,000 total, then 25% of £5,000 = £1,250 penalty leaves £3,750 vs £4,000 original = 6.25% loss). Maximum lifetime bonus over 32 years of contributions (age 18 to 50) = £32,000 plus investment growth on the bonus itself. See our ISA allowance 2026/27 guide for the full LISA deep-dive.

How does the Junior ISA work?

A Junior ISA is opened by a parent or guardian for a child under 18, with an annual allowance of £9,000 per child per year (frozen since 2020/21). The child takes CONTROL at age 16 (can manage investments, choose providers) but cannot WITHDRAW until 18. The JISA converts automatically to an adult ISA on the child's 18th birthday. Cumulative contributions over 18 years × £9,000 = £162,000 maximum parental contribution, plus investment growth typically reaching £200-300k at 6-8% real return. From April 2024, 16-17 year olds can no longer hold both a JISA AND a separate adult Cash ISA (the old "double allowance" loophole was closed). JISA contributions do NOT count toward the adult £20,000 allowance - they're a separate cap for each child.

Are ISA gains and interest taxable?

No - genuinely tax-free within the ISA wrapper. All interest, dividend income, and capital gains within an ISA are exempt from UK Income Tax and Capital Gains Tax. Withdrawals are entirely tax-free at any time (subject to LISA rules). ISAs sit OUTSIDE Self Assessment - no need to declare ISA income or gains anywhere on your tax return. ISA income does NOT count against the £500 Dividend Allowance or £1,000/£500 Personal Savings Allowance - so those external allowances remain available for non-ISA savings/investments. The only tax that touches ISA assets is foreign withholding tax (e.g. US 15% under W-8BEN on US dividends, not refundable into the ISA). Inheritance Tax DOES apply to ISA holdings on death - the wrapper protects against income/CGT, not IHT.

What is the flexible ISA feature?

A flexible ISA (offered by SOME providers) allows withdrawals to be replaced within the same tax year WITHOUT affecting the £20,000 allowance. Worked example: deposit £15,000 in April → withdraw £5,000 in December → re-deposit £5,000 in March = total used £15,000 (not £20,000). NON-flexible ISAs treat any re-deposit as new subscription, eating into remaining allowance. Common flexible ISAs: Nationwide Cash ISA, Marcus by Goldman Sachs ISA, most NS&I products, Vanguard S&S ISA (cash holdings only). NOT flexible: Lifetime ISA (penalty applies anyway), most challenger-bank Cash ISAs, many platform-based S&S ISAs on the equity side. Check before withdrawing - if not flexible, withdrawals permanently lose that year's allowance.

What happens to my ISA when I die?

Inherited ISA Allowance (APS - Additional Permitted Subscription). When an ISA holder dies, their surviving spouse / civil partner gets an additional one-off ISA allowance equal to the value of the deceased's ISA at death. This is on TOP of the spouse's own £20,000 annual allowance. Example: husband dies holding £150k in ISAs. Wife gets her own £20,000 regular allowance for that tax year PLUS a £150k APS allowance she can contribute over 3 years. Total wife's tax-free contribution capacity for that year = £170k. The APS is only available where you were legally married or in a civil partnership at the time of death. For non-spouse beneficiaries: the ISA wrapper terminates on death, assets become part of the estate, future growth/income becomes taxable. IHT applies to ISA assets at the deceased's death value - the ISA wrapper does NOT shield against IHT.

ISA vs SIPP - which is better for retirement saving?

Depends on marginal tax rate now vs in retirement. SIPP wins for higher-rate earners : 40% upfront tax relief, taxed at 20% on withdrawal (if basic-rate in retirement) = 20pp arbitrage. £10k SIPP contribution costs £6k net (after 40% relief), grows to £25-50k over 25 years, withdrawn at 20% = £20-40k net. Same £10k into ISA: £10k net cost, same growth, full £25-50k tax-free withdrawal. SIPP wins net for higher-rate earners by ~10-15%. ISA wins for flexibility : accessible at any age (SIPP locked until 55, rising to 57 from April 2028), no withdrawal tax (SIPP 25% PCLS + marginal rate on rest), used for any purpose (SIPP retirement-only). For basic-rate : roughly tied (20% relief in = 20% tax out = neutral). ISA wins on flexibility. Practical : maximise SIPP up to employer match, then maximise ISA, then back to SIPP. The £60k Annual Allowance + £20,000 ISA = combined £80k of after-tax savings per year.

Can I transfer my ISA between providers?

Yes - and you should periodically. ISA transfers do not count against your annual £20,000 allowance. Current-year contributions : must transfer the ENTIRE current-year contribution to one new provider (cannot split). Previous-year contributions : can be split, partial-transferred to multiple providers. Transfer process: NEW provider initiates the transfer via "ISA Transfer Form" - never withdraw and re-deposit yourself (that counts as new contribution and uses up allowance). HMRC requires Cash ISA transfers within 15 working days, S&S ISA transfers within 30 working days. Older accounts often have inferior interest rates (sometimes 2-3pp lower than current best-buys). S&S ISA platforms: choose by fund availability + platform fees (Vanguard 0.15% capped £375/yr, AJ Bell 0.25%, Hargreaves 0.45%, free at Trading 212).

Should I lump-sum at start of tax year or spread monthly?

6 April lump sum is mathematically better for S&S ISA - more time in market generates ~0.5% per month of additional expected return at 6% annual rate. £20,000 invested 6 April vs same £20k invested 5 April next year = ~12 months of compounding difference = ~£1,200 of expected return foregone. For Cash ISAs the timing matters less because interest is similar across the year. Pound-cost averaging (£1,667/month standing order) is psychologically easier and reduces volatility risk for nervous investors - but mathematically inferior over long horizons (8 of 10 years lump-sum beats pound-cost averaging based on historical S&P 500 + FTSE All-Share data). Use whichever you'll actually stick with - the worst strategy is "wait for the right time to invest" and then never deploying capital. The "ISA season" January-March marketing push by providers is behavioural manipulation - they want you panic-buying at the deadline; mathematically you've already lost 9 months of compounding by then.

What is the Help to Buy ISA? Is it still open?

CLOSED to new applications since 30 November 2019. Existing Help to Buy ISA holders can continue contributing until 30 November 2029 and claim the bonus until 1 December 2030. Help to Buy ISA: £200/month contribution cap, £1,200 first-month bonus allowed, 25% government top-up paid when you exchange contracts on a first-home purchase (max £3,000 bonus on £12,000 contributions). The successor product is the Lifetime ISA (LISA) - more generous (£4,000/year cap vs £2,400/year on Help to Buy). Most Help to Buy ISA holders should consider transferring to LISA - higher allowance + more flexible use (retirement OR first home) generally outweighs the slightly different rules. CANNOT have both Help to Buy ISA AND LISA bonus on the same property - choose one at purchase.

What is the Personal Savings Allowance interaction with ISAs?

These are SEPARATE tax-free allowances. PSA: £1,000 basic-rate / £500 higher-rate / £0 additional-rate of bank interest tax-free OUTSIDE ISAs. £500 Dividend Allowance for all taxpayers OUTSIDE ISAs. For a basic-rate earner with sub-£20k cash savings, an ISA wrapper provides no current tax benefit - savings interest of £1,000 from £20k at 5% is fully PSA-covered. ISAs become more valuable above PSA thresholds, for higher-rate / additional-rate taxpayers (no or reduced PSA), or for equity investors using S&S ISA (no Dividend Allowance limit inside ISA, no CGT on share sales). Worked example: higher-rate earner holds £100k in S&S investments. Outside ISA: ~£3,000-5,000/year of dividend tax at 35.75% + potentially CGT on sales. Inside ISA: £0 tax. The ISA wrapper has ~£1,000-2,000/year tax benefit at that scale.

UK ISA Allowance (2026/27): £20,000 Tax-Free Wrapper

The Individual Savings Account allowance for 2026/27 is £20,000 per individual, frozen at this level since 2017/18 (longest frozen period in ISA history). Split however you choose across Cash, Stocks & Shares, Innovative Finance and Lifetime ISAs - subject to the £4,000 LISA sub-limit. Junior ISAs get a separate £9,000 cap per child. ISAs are entirely outside UK Income Tax and Capital Gains Tax - no need to declare ISA income or gains on your Self Assessment.

Key 2026/27 ISA figures

Adult ISA total

£20,000

All adult ISA types combined

LISA cap

£4,000

Within £20k + 25% gov bonus

LISA max bonus

£1,000

Free gov top-up annually

Junior ISA per child

£9,000

Separate from £20k adult

ISA allowance history

Tax year	Adult ISA limit
2016/17	£15,240
2017/18	£20,000
2018/19	£20,000
2019/20	£20,000
2020/21	£20,000
2021/22	£20,000
2022/23	£20,000
2023/24	£20,000
2024/25	£20,000
2025/26	£20,000
2026/27 ← current	£20,000
2027/28+	£20,000

Frozen at £20,000 since 2017/18 - 13+ year freeze by 2031. Pre-2017/18 the limit was £15,240 (2016/17), £15,240 (2015/16), £15,000 (2014/15). With ~30% CPI inflation across 2017-2030 the ISA's real-terms allowance has fallen approximately 23%. If indexed with CPI from 2017/18, the allowance would be approximately £26,000 by 2026/27.

4 adult ISA types compared

Type	Annual limit	Risk	Best for
Cash ISA	£20k shared	Low (FSCS £85k)	Emergency fund
Stocks & Shares	£20k shared	Market risk	Long-term wealth (5+ years)
Lifetime ISA	£4k of £20k	As underlying	First home or age 60
Innovative Finance	£20k shared	High (no FSCS)	Yield seekers

20-year ISA compounding at 6% real return

Stocks & Shares ISA with diversified equity exposure (UK All-Share or global tracker) has averaged 6-7% real annual return since 2000. Below: monthly contribution × years at 6%.

Monthly	5 years	10 years	20 years
£100/mo (£1,200/yr)	£6,977	£16,388	£46,204
£250/mo (£3,000/yr)	£17,443	£40,970	£115,510
£500/mo (£6,000/yr)	£34,885	£81,940	£231,020
£1,000/mo (£12,000/yr)	£69,770	£163,879	£462,041
£1,667/mo (~£20k max)	£116,307	£273,187	£770,222

Maxing the £20,000 ISA at 6% real return for 20 years = ~£770k. Compounding tax-free inside the ISA - no CGT on share sales, no dividend tax, no income tax on bond coupons. Outside ISA at higher-rate, ~30% lost to tax over the same period.

ISA tax treatment summary

Interest, dividends, capital gains within ISA exempt from Income Tax + CGT.
ISA income does NOT count against £500 Dividend Allowance or £1,000/£500 Personal Savings Allowance - those external allowances stay intact.
Withdrawals entirely tax-free at any time (subject to LISA early-withdrawal penalty).
ISAs sit OUTSIDE Self Assessment - no need to declare on tax return.
On death: APS (Additional Permitted Subscription) for surviving spouse equal to deceased's ISA value, on top of regular £20k allowance.
Inheritance Tax DOES apply - ISA wrapper protects income/CGT, not IHT.
Foreign withholding tax (e.g. US 15% on dividends) still applies inside ISA, not refundable.

Frequently asked questions

What is the UK ISA allowance for 2026/27?: £20,000 per individual per tax year, frozen at this level since 2017/18 (longest frozen period in ISA history). Confirmed frozen through at least April 2031 (extended at Autumn Budget 2025) by Autumn Budget 2024. The £20,000 can be split across any combination of Cash ISA, Stocks & Shares ISA, Innovative Finance ISA and Lifetime ISA, subject to the £4,000 sub-limit on LISA. Junior ISAs have a SEPARATE £9,000 allowance per child per year that doesn't count toward the adult limit. The "British ISA" additional £5,000 for UK shares only (proposed Spring Budget 2024) was SCRAPPED by Labour in Autumn Budget 2024 - the original £20k structure remains unchanged.
Can I have multiple ISAs of the same type in one tax year?: Yes since April 2024. The ISA Bill 2024 removed the previous one-Cash-ISA-and-one-S&S-ISA-per-year restriction. From 6 April 2024 onwards a saver can open and contribute to multiple Cash ISAs AND multiple S&S ISAs in the same tax year, subject to the overall £20,000 allowance. Lifetime ISA still has its own quirks - max one LISA per year and the £4,000 sub-limit applies. Innovative Finance ISA also still limited to one per year due to P2P platform mechanics. The multi-ISA change opens up opportunities to chase best-buy interest rates across multiple Cash ISA providers within a year without losing allowance.
What is the Lifetime ISA (LISA)?: A LISA allows up to £4,000 of contributions per year between ages 18 and 50. The Government adds a 25% bonus on contributions (up to £1,000 per year), payable monthly. LISA funds can be withdrawn penalty-free for a first home purchase up to £450,000, or from age 60. Withdrawals for any other reason before age 60 attract a 25% government penalty - which actually amounts to a 6.25% net loss on the contribution (because 25% bonus on £4,000 = £5,000 total, then 25% of £5,000 = £1,250 penalty leaves £3,750 vs £4,000 original = 6.25% loss). Maximum lifetime bonus over 32 years of contributions (age 18 to 50) = £32,000 plus investment growth on the bonus itself. See our ISA allowance 2026/27 guide for the full LISA deep-dive.
How does the Junior ISA work?: A Junior ISA is opened by a parent or guardian for a child under 18, with an annual allowance of £9,000 per child per year (frozen since 2020/21). The child takes CONTROL at age 16 (can manage investments, choose providers) but cannot WITHDRAW until 18. The JISA converts automatically to an adult ISA on the child's 18th birthday. Cumulative contributions over 18 years × £9,000 = £162,000 maximum parental contribution, plus investment growth typically reaching £200-300k at 6-8% real return. From April 2024, 16-17 year olds can no longer hold both a JISA AND a separate adult Cash ISA (the old "double allowance" loophole was closed). JISA contributions do NOT count toward the adult £20,000 allowance - they're a separate cap for each child.
Are ISA gains and interest taxable?: No - genuinely tax-free within the ISA wrapper. All interest, dividend income, and capital gains within an ISA are exempt from UK Income Tax and Capital Gains Tax. Withdrawals are entirely tax-free at any time (subject to LISA rules). ISAs sit OUTSIDE Self Assessment - no need to declare ISA income or gains anywhere on your tax return. ISA income does NOT count against the £500 Dividend Allowance or £1,000/£500 Personal Savings Allowance - so those external allowances remain available for non-ISA savings/investments. The only tax that touches ISA assets is foreign withholding tax (e.g. US 15% under W-8BEN on US dividends, not refundable into the ISA). Inheritance Tax DOES apply to ISA holdings on death - the wrapper protects against income/CGT, not IHT.
What is the flexible ISA feature?: A flexible ISA (offered by SOME providers) allows withdrawals to be replaced within the same tax year WITHOUT affecting the £20,000 allowance. Worked example: deposit £15,000 in April → withdraw £5,000 in December → re-deposit £5,000 in March = total used £15,000 (not £20,000). NON-flexible ISAs treat any re-deposit as new subscription, eating into remaining allowance. Common flexible ISAs: Nationwide Cash ISA, Marcus by Goldman Sachs ISA, most NS&I products, Vanguard S&S ISA (cash holdings only). NOT flexible: Lifetime ISA (penalty applies anyway), most challenger-bank Cash ISAs, many platform-based S&S ISAs on the equity side. Check before withdrawing - if not flexible, withdrawals permanently lose that year's allowance.
What happens to my ISA when I die?: Inherited ISA Allowance (APS - Additional Permitted Subscription). When an ISA holder dies, their surviving spouse / civil partner gets an additional one-off ISA allowance equal to the value of the deceased's ISA at death. This is on TOP of the spouse's own £20,000 annual allowance. Example: husband dies holding £150k in ISAs. Wife gets her own £20,000 regular allowance for that tax year PLUS a £150k APS allowance she can contribute over 3 years. Total wife's tax-free contribution capacity for that year = £170k. The APS is only available where you were legally married or in a civil partnership at the time of death. For non-spouse beneficiaries: the ISA wrapper terminates on death, assets become part of the estate, future growth/income becomes taxable. IHT applies to ISA assets at the deceased's death value - the ISA wrapper does NOT shield against IHT.
ISA vs SIPP - which is better for retirement saving?: Depends on marginal tax rate now vs in retirement. SIPP wins for higher-rate earners: 40% upfront tax relief, taxed at 20% on withdrawal (if basic-rate in retirement) = 20pp arbitrage. £10k SIPP contribution costs £6k net (after 40% relief), grows to £25-50k over 25 years, withdrawn at 20% = £20-40k net. Same £10k into ISA: £10k net cost, same growth, full £25-50k tax-free withdrawal. SIPP wins net for higher-rate earners by ~10-15%. ISA wins for flexibility: accessible at any age (SIPP locked until 55, rising to 57 from April 2028), no withdrawal tax (SIPP 25% PCLS + marginal rate on rest), used for any purpose (SIPP retirement-only). For basic-rate: roughly tied (20% relief in = 20% tax out = neutral). ISA wins on flexibility. Practical: maximise SIPP up to employer match, then maximise ISA, then back to SIPP. The £60k Annual Allowance + £20,000 ISA = combined £80k of after-tax savings per year.
Can I transfer my ISA between providers?: Yes - and you should periodically. ISA transfers do not count against your annual £20,000 allowance. Current-year contributions: must transfer the ENTIRE current-year contribution to one new provider (cannot split). Previous-year contributions: can be split, partial-transferred to multiple providers. Transfer process: NEW provider initiates the transfer via "ISA Transfer Form" - never withdraw and re-deposit yourself (that counts as new contribution and uses up allowance). HMRC requires Cash ISA transfers within 15 working days, S&S ISA transfers within 30 working days. Older accounts often have inferior interest rates (sometimes 2-3pp lower than current best-buys). S&S ISA platforms: choose by fund availability + platform fees (Vanguard 0.15% capped £375/yr, AJ Bell 0.25%, Hargreaves 0.45%, free at Trading 212).
Should I lump-sum at start of tax year or spread monthly?: 6 April lump sum is mathematically better for S&S ISA - more time in market generates ~0.5% per month of additional expected return at 6% annual rate. £20,000 invested 6 April vs same £20k invested 5 April next year = ~12 months of compounding difference = ~£1,200 of expected return foregone. For Cash ISAs the timing matters less because interest is similar across the year. Pound-cost averaging (£1,667/month standing order) is psychologically easier and reduces volatility risk for nervous investors - but mathematically inferior over long horizons (8 of 10 years lump-sum beats pound-cost averaging based on historical S&P 500 + FTSE All-Share data). Use whichever you'll actually stick with - the worst strategy is "wait for the right time to invest" and then never deploying capital. The "ISA season" January-March marketing push by providers is behavioural manipulation - they want you panic-buying at the deadline; mathematically you've already lost 9 months of compounding by then.
What is the Help to Buy ISA? Is it still open?: CLOSED to new applications since 30 November 2019. Existing Help to Buy ISA holders can continue contributing until 30 November 2029 and claim the bonus until 1 December 2030. Help to Buy ISA: £200/month contribution cap, £1,200 first-month bonus allowed, 25% government top-up paid when you exchange contracts on a first-home purchase (max £3,000 bonus on £12,000 contributions). The successor product is the Lifetime ISA (LISA) - more generous (£4,000/year cap vs £2,400/year on Help to Buy). Most Help to Buy ISA holders should consider transferring to LISA - higher allowance + more flexible use (retirement OR first home) generally outweighs the slightly different rules. CANNOT have both Help to Buy ISA AND LISA bonus on the same property - choose one at purchase.
What is the Personal Savings Allowance interaction with ISAs?: These are SEPARATE tax-free allowances. PSA: £1,000 basic-rate / £500 higher-rate / £0 additional-rate of bank interest tax-free OUTSIDE ISAs. £500 Dividend Allowance for all taxpayers OUTSIDE ISAs. For a basic-rate earner with sub-£20k cash savings, an ISA wrapper provides no current tax benefit - savings interest of £1,000 from £20k at 5% is fully PSA-covered. ISAs become more valuable above PSA thresholds, for higher-rate / additional-rate taxpayers (no or reduced PSA), or for equity investors using S&S ISA (no Dividend Allowance limit inside ISA, no CGT on share sales). Worked example: higher-rate earner holds £100k in S&S investments. Outside ISA: ~£3,000-5,000/year of dividend tax at 35.75% + potentially CGT on sales. Inside ISA: £0 tax. The ISA wrapper has ~£1,000-2,000/year tax benefit at that scale.