The last year for a full cash ISA

Last reviewed: August 2026

If you save in cash ISAs and you are under 65, this tax year is different from the ones before it.

From 6 April 2027, the amount anyone under 65 can put into a cash ISA each year falls from £20,000 to £12,000. Savers aged 65 and over keep the full £20,000.

The overall ISA allowance is not changing. It stays at £20,000 for everyone. What changes is how much of it can sit in cash. From April 2027 an under-65 wanting to use the full allowance would need to put at least £8,000 into a stocks and shares ISA, an innovative finance ISA or a lifetime ISA.

That makes 2026/27 the last tax year in which someone under 65 can shelter the full £20,000 in cash. The allowance runs out at midnight on 5 April 2027 and cannot be carried forward.

What this does and does not mean

It does not affect money already in a cash ISA. Anything already sheltered stays sheltered, and keeps growing tax free, with no cap on how large it becomes. The change restricts new contributions only.

It does not mean you should rush money into cash. If you were not going to use the allowance anyway, a deadline is not a reason to. And if the money is for something more than five years away, cash may be the wrong home for it regardless of the wrapper.

It does mean that if you hold significant cash savings outside an ISA and you are under 65, this year is worth a look.

Why it matters more than it used to

Two other things have moved, and they push in the same direction.

Dividend tax rose in April 2026. Outside an ISA, dividends above the £500 allowance are now taxed at 10.75% for basic rate taxpayers and 35.75% for higher rate, up two percentage points each. The additional rate stays at 39.35%.

The capital gains allowance is £3,000, down from £12,300 three years ago.

Both make sheltering investments inside an ISA more valuable than it was, and both apply whatever your age.

The rest of the year-end list

While you are looking, these are the allowances that reset on 5 April and cannot be carried into the next year.

ISA allowance, £20,000. Per person, so £40,000 for a couple.

Junior ISA, £9,000 per child, separate from your own allowance and frozen until at least 2030/31.

Capital gains allowance, £3,000. Realising gains up to this each year, over several years, is often better than one large disposal.

Dividend allowance, £500.

Personal savings allowance, £1,000 for basic rate taxpayers and £500 for higher rate.

Inheritance tax gifting exemption, £3,000. This one can be carried forward, but one year only. If last year’s is unused you could give £6,000, or £12,000 for a couple. There is more on this in our article on helping your grandchildren financially.

Marriage allowance, £1,260, transferable to a spouse or civil partner where one of you earns below the personal allowance.

And the one that is not use-it-or-lose-it in the same way: the pension annual allowance of £60,000, where unused allowance from the previous three tax years can often be carried forward. Worth checking before assuming you have run out of room.

One caution

None of this is a reason to make an investment you would not otherwise make. Every year a certain amount of money goes into things chosen because the deadline was close rather than because they were right.

The allowances are worth using if you were going to save or invest anyway. They are not a reason to save money you need, or to take risk you would rather not take.

If you would like to check where you stand

That is exactly what a first conversation is for. It is free, and if the answer is that you are already making good use of your allowances, we will say so.

The first conversation is free and there is no obligation. Book with whichever adviser is closest to you, or whoever suits. We work with clients across the UK.

Lee Barton (Leicester) | Ian Laker (Tamworth) | Chris Wood (Coventry)

This article is for general information and does not constitute personal advice. Figures apply to the 2026/27 tax year. The announced cash ISA change takes effect from 6 April 2027 and remains subject to legislation. The value of investments can fall as well as rise and you may get back less than you invested. Tax treatment depends on your individual circumstances and may change.