ISAve for their future

What is an ISA and how does it work?

An ISA (Individual Savings Account) is a tax-efficient way to save or invest because you don’t pay tax on the interest earned on cash held in the account.

How much can I save in an ISA?

You can currently save up to £20,000 in an ISA per tax year. The allowance can be split across different ISA types, including Cash ISAs and Stocks & Shares ISAs.

Are ISAs tax-free?

Yes. ISAs allow you to earn interest on savings without paying tax on the interest earned.

What is the minimum age to open an ISA?

All UK residents aged 18 or over can open an ISA.

What are the different types of ISA?

• Cash ISA – A savings account where the interest you earn is tax-free.
• Stocks & Shares ISA – Allows you to invest in shares, funds or bonds.
• Lifetime ISA – Designed for saving towards a first home or retirement.
• Innovative Finance ISA – Invests in peer-to-peer lending.
• Junior ISA – A tax-free account for children under 18.

What is a Cash ISA?

Cash ISAs are similar to other savings accounts, but the interest earned is tax-free and does not affect your Personal Savings Allowance.

Can I have more than one ISA?

Under HMRC regulations, and where providers allow it, you can subscribe to multiple ISA providers within the same tax year, provided you stay within the overall ISA allowance.

Can I have a joint ISA?

No. ISAs must be held in an individual’s name and cannot be opened as joint accounts.

Do I need to open a new Cash ISA every year?

No. You can continue adding to an existing ISA each year, provided you remain within the annual ISA allowance.

Is money held in an ISA protected?

Yes. Cash ISA deposits held with a UK-regulated bank or building society are protected under the Financial Services Compensation Scheme (FSCS) up to the applicable protection limits.

For more information click here.

What is the ISA allowance limit?

The ISA allowance is currently £20,000 per tax year.

When does the ISA allowance reset?

The ISA allowance resets at the start of each tax year on 6 April. Could you maximise your savings allowance before ISA tax year end?

Can I carry forward my ISA allowance?

No. Any unused ISA allowance cannot be carried forward to future tax years.

What happens if I exceed my ISA allowance?

If you exceed the annual allowance, the additional amount may lose its tax-free status.

Are ISA transfers counted as new contributions?

No. Transfers between ISA providers do not count towards your annual allowance, provided the transfer is completed using the official ISA transfer process.

What is the Cash ISA limit from April 2027?

From 6 April 2027, the amount that can be contributed to Cash ISAs will be limited to £12,000 per year for savers under 65, as announced in the Autumn Budget 2025. Cash ISA news

What happens to my existing Cash ISA savings?

Money already held in a Cash ISA remains tax-free and is not affected by the new contribution limit.

Cash ISA vs Stocks & Shares ISA

Cash ISAs provide tax-free interest with lower risk, while Stocks & Shares ISAs invest in financial markets and may offer higher potential returns over the long term but with greater risk.

Is it better to have an ISA or a savings account?

ISAs allow interest or investment growth to be earned tax-free, while interest from standard savings accounts may be taxable if it exceeds your Personal Savings Allowance.

Learn more in our ISAs vs Savings Accounts – what’s the difference?

Can I have both an ISA and a savings account?

Yes. Many savers use both to balance tax-efficient long-term savings with the flexibility of easy-access accounts.

Is splitting savings between an ISA and a savings account a good idea?

It can be useful depending on your goals. ISAs can help with tax-efficient long-term savings, while standard savings accounts may offer easier access to funds.

Can you transfer an ISA from one bank to another?

Yes, you can transfer your ISA to another provider without losing the tax-free benefits, as long as the transfer is completed through the official ISA transfer process. Support

What are the benefits of using an ISA for savings?

ISAs allow you to earn tax-free interest or investment growth, helping your savings grow more efficiently over time.

Can I withdraw money from my ISA tax-free?

Yes. Withdrawals from ISAs are tax-free, although depending on the type of ISA you hold there may be charges or loss of interest for early withdrawals. Cash ISA transfers – what you need to know

What happens to my ISA tax benefits if I withdraw money?

Once money is withdrawn from an ISA and held outside it, the funds may no longer benefit from the ISA’s tax-free status.

How flexible are ISAs for withdrawals?

This depends on the account type. Some ISAs allow withdrawals at any time, while fixed-term ISAs may apply penalties or interest reductions.

How can an ISA help protect savings from inflation?

Because returns earned inside an ISA are tax-free, more of your savings remain invested and can continue to grow over time.

What is an ISA transfer?

An ISA transfer allows you to move your ISA savings between providers while keeping the tax-free status of your savings.

See our Cash ISA transfers – what you need to know for more details.