| ISA Type | 2024/2025 Maximum Subscription | Age Requirement | Key Features |
|---|---|---|---|
| Cash ISA | Up to £20,000 | 18+ (to open) | Tax-free interest, flexible withdrawals, fixed and variable-rate products available. |
| Stocks and Shares ISA | Up to £20,000 | 18+ | Potentially higher returns, but comes with investment risk. Dividends and capital gains within the ISA are tax-free. |
| Innovative Finance ISA | Up to £20,000 | 18+ | Peer-to-peer lending and crowdfunding investments; generally higher rates but higher risk. |
| Lifetime ISA (LISA) | Up to £4,000 (within £20,000 total) | 18–39 (to open) | Government bonus of 25% on contributions. Designed for first-home purchase or retirement. Withdrawal rules apply. |
| Junior ISA (JISA) | £9,000 (separate from adult ISA) | Under 18 | Parents/guardians can open for a child. Funds are locked in until the child turns 18. |
How Does the Cash ISA Allowance Work?
Your cash ISA allowance is simply the portion of your overall £20,000 that you choose to put into a cash ISA. You can decide how much of your total ISA allowance goes into cash, and how much goes into other ISA types.
Remember, you cannot exceed the total ISA allowance across all your ISAs in the 2024/2025 tax year. Even if you open multiple cash ISAs, the combined amount you deposit into them cannot surpass your overall allowance. However, you may prefer to keep things simple by opening just one cash ISA each tax year.
Can you split your allowance between different ISAs?
Yes. One of the main attractions of ISAs is their flexibility. You can split your overall ISA allowance however you like, as long as the total does not exceed £20,000 for the 2024/2025 tax year. For instance, you could put £10,000 in a cash ISA limit and £10,000 in a Stocks and Shares ISA, or spread it among Innovative Finance and Lifetime ISAs if that suits your personal goals.
How does transferring an ISa affect your allowance?
You can move your entire ISA balance to another provider without losing your tax-free status. Any money contributed in previous tax years will not count towards your 2024/2025 ISA allowance.
Keeping your tax-free benefits
Make sure you follow the official transfer process—this usually involves completing a transfer form through the new provider. If you withdraw the money yourself instead, you’ll lose the tax-free status on those funds. By letting your provider handle the transfer from start to finish, you can seamlessly switch ISAs while preserving your annual allowance.
Frequently Asked Questions
No. Any interest or investment gains you earn within an ISA do not count against your annual ISA allowance. The allowance refers only to the amount you deposit or invest in the ISA within a single tax year.
If you accidentally pay in more than the annual limit, your ISA provider may return the excess funds or freeze the additional deposit. You should also notify HMRC, as you may need to withdraw or reclassify the surplus amount to avoid potential tax implications.
Your ISA allowance resets at the beginning of each tax year, which runs from 6 April to 5 April the following year. Any unused allowance from the previous tax year does not roll over to the next.
No, contributions to a Junior ISA do not reduce your personal ISA allowance.
.A Junior ISA has its own annual allowance of £9,000 per tax year.
No. ISAs are solely for individual UK residents. A limited company cannot open or hold an ISA. If you require a savings account for your business, you’ll need to look into alternative business banking or investment products.
*As with all investing, financial instruments involve inherent risks, including loss of capital, market fluctuations and liquidity risk. Past performance is no guarantee of future results. It is important to consider your risk tolerance and investment objectives before proceeding.
