ISAs remain one of the most tax efficient solutions for your savings. On 1 July 2014, several restrictions were removed to improve flexibility and transfer options.
From April 2024 there is no limit to the number of ISA’s you can open, you can now invest in as many ISA’s as you see fit, you're also now able to make partial transfers from one ISA to another.
The overall adult ISA allowance is £20,000 for 2026/27. This is a combined annual limit across your ISAs, not a separate allowance for each account.
You'll also be able to transfer new and previous years' ISA investments from Stocks and Shares into Cash, and vice versa, as opposed to previous rules which didn’t allow stocks and shares ISAs to be transferred into Cash ISAs.
From Autumn 2015 individuals may be able to withdraw money from ISAs and replace it in the same tax year without the replacement counting towards their annual ISA subscription limit for that year. This only applies if the ISA has adopted the Flexible ISA rules. Please check with your provider.
What is an ISA?
Adult ISAs are available to eligible UK residents aged 18 or over.
Tax must usually be paid on the income and profits made from stock market investments - either directly or via unit trusts and OEICs - however, an ISA is a tax wrapper and placing savings into an ISA is tax efficient. You will not be charged Capital Gains Tax on investment growth or Income Tax on any income or dividends received.
The Government has said that the ISA will be available indefinitely.
The main benefits of an ISA
No personal tax (income or capital gains) on any investments in an ISA.
Income and gains from ISAs do not need to be included in tax returns.
How ISAs work
There are several types of ISA, which may contain one or more of the following components:
Stocks and shares, in the form of either individual shares or bonds, or pooled investments such as open-ended investment funds or life assurance investments.
Cash, usually containing a bank or building society savings account.
Junior ISAs
Junior ISAs can hold cash or stocks and shares. The combined annual contribution limit is £9,000 for 2026/27. To qualify, a child must meet the following conditions:
- Are under 18: The child must be under the age of 18.
- A UK Resident: The child must live in the UK.
- Not hold a Child Trust Fund alongside a Junior ISA. An existing Child Trust Fund can be transferred in full to a Junior ISA and closed. Child Trust Funds covered children born between 1 September 2002 and 2 January 2011; the scheme is closed to new accounts.