Cash ISA Allowance Changes 2027: What Savers Need to Know

In recent years, changes to ISA rules have given savers more flexibility. In the 2024/25 tax year, one of the key changes was the ability to open more than one ISA of the same type in the same tax year. You can also transfer all or part of your ISA between providers without affecting its tax-efficient status.

From 6 April 2027, the Cash ISA allowance will reduce from £20,000 to £12,000 for savers under the age of 65.

If you are aged 65 or over, you will not be affected by this reduction, as the Cash ISA allowance will remain at £20,000.

What about Stocks and Shares ISAs?

For now, the overall ISA allowance remains £20,000. This means you can still use Stocks and Shares ISAs and other eligible ISAs as part of your annual allowance.

The key point is that, from April 2027, savers under 65 will no longer be able to place the full £20,000 annual allowance into a Cash ISA. The remaining allowance may need to be considered through other eligible ISA options, depending on your circumstances and attitude to risk.

Planning ahead is the key

As the change does not take effect until 6 April 2027, savers still have the 2026/27 tax year to make use of the current rules.

It is also important to remember that the maximum you can pay into adult ISAs in any tax year remains £20,000 in total. This applies across ISA types, rather than separately to each account.

For many savers, this change makes it worth reviewing how Cash ISAs, Stocks and Shares ISAs and other savings options fit into their wider financial plans.

Need help planning ahead?

ISA rules can change, but good planning starts with understanding your options. If you are unsure how the 2027 Cash ISA changes may affect your savings strategy, Stratos can help you review the position and consider the next steps.

Get in touch with Stratos today. We are here to help you plan with confidence, navigating the way through the changes ahead.

Frequently asked questions

When is the Cash ISA allowance changing?

The change is due to take effect from 6 April 2027, at the start of the 2027/28 tax year.

Who will be affected by the new Cash ISA allowance?

Savers under the age of 65 will see the Cash ISA allowance reduce from £20,000 to £12,000. Savers aged 65 or over will continue to have a £20,000 Cash ISA allowance.

Is the overall ISA allowance changing?

No. The overall adult ISA allowance remains £20,000. The change affects how much of that allowance savers under 65 can put into a Cash ISA.

Should I change my savings plans now?

There is still time before the new rules take effect, but it may be sensible to review your savings and investment plans ahead of the change.