When does the ISA allowance reset in 2025?

This year’s ISA allowance resets on the 6th April 2025. But, if you’re thinking of putting money into an ISA (Individual Savings Account) to save or invest tax-efficiently, it’s important to be aware of the different ISA allowances. These dictate how much money you’re allowed to contribute to your account every year.

What is the tax-free ISA allowance?

The tax-free ISA allowance is the maximum amount of money you can contribute to an ISA account every tax year. In the UK, the tax year runs from the 6th of April to the 5th of April the following year.

You can choose to split your ISA allowance across different types of ISAs (e.g. cash, stocks and shares, lifetime ISA, etc.) or invest it all in one type of ISA. However, you can only contribute to one of each type of ISA per tax year.

What are the current ISA allowances? 

For the 2025/2026 tax year, the ISA allowances which reset on the 6th April are:

• Cash ISA – £20,000
• Stocks and shares ISA – £20,000
• Innovative finance ISA – £20,000
• Lifetime ISA – £4,000 (contributions into a Lifetime ISA count towards your £20,000 Stocks and Shares ISA, Cash ISA, or Innovative Finance ISA annual allowance)
• Junior ISA – £9,000

The key takeaway here is that adults in the UK generally have an annual ISA allowance of £20,000. However, if one makes a contribution to a lifetime ISA, this counts towards that £20,000 allowance.

What is the ISA deadline?

The ISA deadline is the last day that you can contribute to an ISA for that tax year. It falls on 5th April every year. The first day you can start investing in a new ISA is on the 6th April 2025.

Pros and cons of ISA allowances

ISA allowances today are quite generous. The ability to save or invest up to £20,000 per year tax-free can really be helpful when building wealth for the future.

One downside to ISA allowances, however, is that you can’t carry them over to the next tax year. If you don’t use your ISA allowance in a specific tax year, that allowance is gone forever.

Historical ISA allowances

ISA allowances haven’t always been as high as they are today. In the past, they were a lot lower.

For example, for the 2000/2001 tax year, the total ISA allowance was £7,000 while the Cash ISA allowance was just £3,000.

Only in the 2017/2018 tax year was the allowance for both Stocks and Shares ISAs and Cash ISAs increased to £20,000.

Cash ISA allowances

For 2025/2026, the annual allowance for cash ISAs is £20,000. This is the same as the annual allowance for Stocks and Shares ISAs.

If you make a contribution to a cash ISA, this will reduce the amount that you can put into a stocks and shares ISA.

For example, if you were to put £5,000 into a cash ISA, you would only be able to contribute £15,000 to a stocks and shares ISA that tax year.

Examples of how ISA allowances can be used  

One attractive feature of ISA allowances is that they can be split across several different types of ISA.

For example, an individual could invest £10,000 of their annual £20,000 allowance in a stocks and shares ISA and £10,000 in a cash ISA.

Alternatively, they could invest £10,000 in a stocks and shares ISA, £4,000 in a lifetime ISA (assuming they were eligible), and £6,000 in a cash ISA.

ISA allowance tips

If you are keen to make the most of the various ISA allowances available, here are some tips:

• Consider contributing on behalf of your spouse – Every adult currently has a £20,000 annual ISA allowance. This means that a couple can potentially contribute up to £40,000 per year into ISAs
• If you are planning to invest a large amount of money, consider investing it over several tax years so that you can invest more tax-free within an ISA. For example, by investing £20,000 in an ISA in late March – before the ISA deadline – and £20,000 in an ISA in mid-April – after the ISA deadline – you could potentially invest £40,000 tax-free within a month
• If you have maxed out your own ISA allowance as well as your spouse’s ISA allowance, you may want to consider making contributions to Junior ISAs on behalf of your children.

Can you pay into more than one investment ISA in a single year?

Yes, you can. For example, if you are eligible for a lifetime ISA, you can pay into this as well as a stocks and shares ISA.

You can only contribute to one of each type of ISA per tax year, however. So, for example, you can only contribute to one stocks and shares ISA per year.

What happens to your ISA allowance if you make a withdrawal?

The implications of taking money out of an ISA depend on whether your ISA is flexible or not.

With a flexible ISA, you can take out money and replace it in the same tax year without the replacement contribution counting towards your annual allowance.

By contrast, with a non-flexible ISA, if you make a withdrawal and then put the money back into your account, the contribution will be classed as a subscription and will count towards your annual ISA allowance.

Currently, flexibility is only offered for cash ISAs, Innovative Finance ISAs, and cash held within stocks and shares ISAs.

What happens to ISA allowances if you die?

If you die, your spouse or civil partner can inherit a one-off additional ISA allowance. This is known as the Additional Permitted Subscription (APS), and it is equal to either the value of your ISA on the day you die or the value on the day the ISA account is closed – whichever is higher.