What is an ISA?
A savings or investment account where interest, dividends and growth are free of UK tax. You can put in up to £20,000 across all your ISAs each tax year. Cash ISAs work like a savings account; stocks and shares ISAs are invested and can fall in value. A Lifetime ISA adds a government bonus but locks the money away.
Last updated
Figures are UK rates and change each April. Source: GOV.UK — Individual Savings Accounts
What does ISA stand for?
ISA stands for Individual Savings Account. It is a tax wrapper rather than a single product: the money inside can be cash, shares or funds, and any interest, dividends or growth is free of UK Income Tax and Capital Gains Tax. You don't need to declare ISA income on a tax return.
Is a savings account an ISA?
Only if the provider says it is. Interest on an ordinary savings account counts towards your Personal Savings Allowance and can be taxed above it. A cash ISA works much the same day to day, but the interest is tax-free and what you pay in counts towards your £20,000 yearly ISA allowance.
How much can I put in an ISA in 2026/27?
Up to £20,000 in total across all your ISAs between 6 April 2026 and 5 April 2027. You can split it between cash, stocks and shares and a Lifetime ISA, though a Lifetime ISA takes no more than £4,000 of it. Any allowance you don't use is lost at the end of the tax year.
What happens to an ISA when your husband or wife dies?
You can pay in an extra amount up to the value of their ISAs when they died, on top of your own £20,000 allowance. Their ISA stays tax-free until the executor closes it, the estate is settled, or three years pass, whichever comes first. Ask the ISA provider how to use the extra allowance.
| ISA allowance (all ISAs combined) | £20,000 |
|---|---|
| Lifetime ISA (counts towards the £20,000) | £4,000 a year, plus a 25% bonus of up to £1,000 |
| Junior ISA (per child) | £9,000 |
Still not sure what this means for you?
Ask Helena, our AI assistant. She gives general information, not financial advice.