The ISA allowance explained

The ISA allowance is the most you can pay into Individual Savings Accounts (ISAs) in one tax year while keeping the returns tax-free. For the 2026/27 tax year it is £20,000. That single £20,000 covers everything you put in across all your ISAs combined, it resets each 6 April, and any of it you do not use is gone for good.

The numbers at a glance

Here are the headline ISA limits for the 2026/27 tax year, which runs from 6 April 2026 to 5 April 2027. The £20,000 is the total you can pay in across every ISA you hold; the other figures are caps that sit inside it or apply to a specific account.

What an ISA actually is

An ISA is an Individual Savings Account: a savings or investment account where you pay no tax on what it earns. Outside an ISA, savings interest above your personal savings allowance and investment gains above your annual exemption can be taxed. Inside an ISA, the interest, dividends and growth are all tax-free, and you never have to declare them.

You have to be at least 18 to open most ISAs (16 in some older cash ISA rules, and from 6 April you can pay into a fresh set each year), and you need to be a UK resident. The tax-free wrapper is the whole point: the money inside grows without the taxman taking a slice, which over years can make a real difference to the total.

The £20,000 allowance

The ISA allowance is the cap on how much new money you can pay into ISAs in a tax year. For 2026/27 it is £20,000, and that is a combined figure. Whether you hold one ISA or five, the total you pay in across all of them cannot top £20,000 in the year.

Two things often trip people up. First, the limit is on money paid in, not on the balance: an ISA that has grown to £60,000 over the years is fine, because the £20,000 only ever applied to new contributions. Second, you can spread the £20,000 however you like, including across more than one ISA of the same type. gov.uk\'s own example splits it as £10,000 in one cash ISA, £3,000 in another, and £7,000 in a stocks and shares ISA, all in the same year.

The four types of ISA

There are four kinds of adult ISA, and they all draw on the same £20,000. The right mix depends on what the money is for and how long you can leave it.

A cash ISA is the simplest: it pays interest like a normal savings account, only the interest is tax-free. A stocks and shares ISA holds investments, so its value can go up or down, but any growth and dividends are tax-free. Cash tends to suit money you might need soon; stocks and shares carries risk but has historically grown more over the long run. The innovative finance ISA wraps peer-to-peer lending and is a niche, higher-risk option.

The Lifetime ISA stands apart. You can pay in up to £4,000 a year, and the government tops it up with a 25% bonus, worth up to £1,000 annually. That £4,000 sits inside your £20,000 allowance, not on top of it. You have to open one before you turn 40 and can keep paying in until you are 50. It is meant for buying your first home or saving for later life: take the money out for anything else and there is a 25% withdrawal charge, which can leave you with less than you put in. Our guide to the Lifetime ISA works through who it suits and the withdrawal trap in full.

You will also hear about a Junior ISA for under-18s and the cash versus stocks and shares choice within your own allowance. The Junior ISA is covered below; the cash-versus-investing decision comes down to your time frame and how comfortable you are with the value moving around, which our cash ISA versus stocks and shares ISA comparison weighs up.

Use it or lose it: the 6 April reset

The ISA allowance does not carry over. Each tax year you get a fresh £20,000, and whatever you did not use the year before simply disappears. The tax year runs from 6 April to 5 April, so your allowance refreshes on 6 April and the clock starts again.

Say you pay in £5,000 this year. The remaining £15,000 is not added to next year\'s limit; come 6 April you are back to a clean £20,000, not £35,000. That is why you often hear about people topping up their ISAs in the days before 5 April, the end of the tax year, sometimes called ISA season. If you have spare cash and unused allowance, using it before the deadline is the only way to keep it. The £20,000 figure itself has held for several years, though the government does review ISA rules from time to time, so it is worth checking the current limit each year on gov.uk.

Junior ISAs

A Junior ISA is a tax-free account for a child under 18, and it has its own separate allowance. For 2026/27 the limit is £9,000, completely apart from your own £20,000. Anyone can pay in, but only the child can take the money out, and only once they turn 18.

A child can take control of the account at 16 but cannot withdraw until 18, when it becomes theirs. Because the money is locked away for years, time in the market does a lot of the work, which is exactly the sort of long-run growth a compound interest works through. Our full Junior ISA guide covers the two types, who can pay in and how to choose one.

Putting the allowance to work

The allowance is only worth having if the money grows. The advantage of an ISA is that nothing is shaved off the returns in tax, so every pound of interest or growth stays invested and compounds. Over a long stretch, that tax-free compounding is where the real difference shows up.

To get a feel for it, the savings calculator shows how regular contributions and a given interest rate build a pot over time, which maps neatly onto paying into a cash ISA each year. If you want to see the effect of returns earning returns, the compound interest calculator projects how a lump sum or monthly amount snowballs at a chosen rate. For the plain-English version of why that snowball matters, our guides on how savings grow and how compound interest works walk through it. All of these are estimates to plan with: real returns, especially on a stocks and shares ISA, are never guaranteed.

Common questions

What is an ISA allowance?

The ISA allowance is the most you can pay into Individual Savings Accounts (ISAs) in a single tax year while keeping the interest, dividends and growth tax-free. For the 2026/27 tax year it is £20,000. That limit covers everything you put in across all your ISAs combined, not £20,000 per account. An ISA is simply a savings or investment account where you pay no tax on what it earns.

Can I put 20k in an ISA every year?

Yes. The £20,000 allowance is an annual limit, so you get a fresh £20,000 to pay in each tax year from 6 April. There is no lifetime cap on how much can build up in your ISAs over time, only the yearly limit on new money going in. What you paid in last year does not use up this year's allowance, and money already sitting in an ISA keeps growing tax-free without counting against the limit.

Does my ISA allowance carry over if I do not use it?

No. Unused ISA allowance does not roll over. If you only pay in £5,000 this year, the other £15,000 is gone when the tax year ends on 5 April, and you start the next year with a fresh £20,000, not £35,000. This is why people often top up their ISA before 5 April, the end of the tax year, sometimes called ISA season. It is genuinely use it or lose it.

When does the ISA allowance reset?

The ISA allowance resets at the start of each tax year, which is 6 April. The tax year runs from 6 April to 5 April the following year, so your £20,000 limit refreshes on 6 April and any allowance you did not use in the year just gone disappears. The figure has been £20,000 for several years, though the government reviews ISA rules from time to time.

Can I pay into more than one ISA in the same year?

Yes. You can split your £20,000 across several ISAs in the same tax year, including more than one of the same type. gov.uk gives the example of paying £10,000 into one cash ISA, £3,000 into another cash ISA and £7,000 into a stocks and shares ISA in one year. The only hard limits are the overall £20,000 and the separate £4,000 cap on a Lifetime ISA, which sits inside the £20,000.

What is the difference between a cash ISA and a stocks and shares ISA?

A cash ISA works like an ordinary savings account, paying interest, but the interest is tax-free. A stocks and shares ISA holds investments such as funds and shares, so its value can rise or fall, and any growth or dividends are tax-free. Cash is steadier and suits money you might need soon; stocks and shares carries risk but has historically tended to grow more over long periods. Which suits you depends on your time frame and how comfortable you are with ups and downs. Treat this as a starting point to weigh up, not financial advice.

How much can I put in a Lifetime ISA?

You can pay up to £4,000 into a Lifetime ISA each year, and the government adds a 25% bonus on top, worth up to £1,000 a year. That £4,000 counts towards your overall £20,000 allowance, so if you pay the full £4,000 into a Lifetime ISA you have £16,000 of allowance left for other ISAs. You must open one before you turn 40 and can pay in until you are 50. A Lifetime ISA is for buying your first home or saving for later life, and taking the money out for anything else means a 25% withdrawal charge.

About this article

Written by the calcd team. We build UK money calculators and explain the numbers behind them in plain English. We checked the 2026/27 ISA allowance, the four ISA types, the Lifetime ISA limit and bonus, the Junior ISA allowance and the tax-year reset against gov.uk as the primary source. The figures here are general information to help you plan, not financial advice, and they can change at a Budget or the start of a tax year. Returns on a stocks and shares ISA are not guaranteed and can fall as well as rise. Confirm the current limits and the right account for you with your provider or a regulated adviser. Last updated June 2026.