ISA Allowance Calculator — UK 2026/27
The UK ISA allowance for the 2026/27 tax year is £20,000. You can split it across Cash, Stocks & Shares, Innovative Finance, and Lifetime ISAs in any combination. The Lifetime ISA is capped at £4,000 and earns a 25% government bonus. Use this calculator to plan your ISA splits and see remaining allowance.
Plan your ISA contributions
How to Use This ISA Allowance Calculator
- Enter how much you plan to contribute to each ISA type during the 2026/27 tax year (6 April 2026 to 5 April 2027). You can split your £20,000 allowance across all four adult ISA types in any combination.
- Lifetime ISA is capped at £4,000 per year and counts toward your £20,000 overall limit. The calculator automatically caps your LISA entry and shows the resulting 25% government bonus.
- Junior ISA has a separate £9,000 annual allowance that does NOT count against your adult £20,000 limit. Each child has their own Junior ISA allowance.
- Review the "Remaining allowance" figure. If the calculator shows OVER limit, reduce your inputs — exceeding £20,000 in adult ISAs triggers HMRC compliance action.
ISA Allowance Rules and Method
The UK ISA system allows tax-free saving and investing up to a fixed annual limit. Key 2026/27 rules:
- Total adult allowance: £20,000. Unchanged since the 2017/18 tax year.
- Four adult ISA types: Cash ISA, Stocks & Shares ISA, Innovative Finance ISA (peer-to-peer lending), and Lifetime ISA.
- Lifetime ISA cap: £4,000 per year (counts toward the £20k overall). Available to ages 18–39. 25% government bonus paid monthly. Penalty for unauthorised withdrawal: 25% of total amount (loses bonus and 6.25% of your own money).
- Junior ISA: £9,000 per child per year. Separate from the adult £20,000. Children can only access funds from age 18.
- April 2024 rule change: you can now subscribe to multiple ISAs of the same type in a single tax year (e.g., two Cash ISAs at different providers) as long as the total doesn't exceed £20,000.
- "Use it or lose it": unused ISA allowance does not roll over to the next tax year.
- Tax treatment: all interest, dividends, and capital gains inside an ISA are tax-free. No declaration required on your self-assessment.
Worked Example — Maxed ISA + LISA
Daniel is 28 and saving for a first home. He earns £45,000 and can save £20,000/year. He splits:
- Lifetime ISA: £4,000 (max) → 25% bonus = £1,000 free from HMRC.
- Stocks & Shares ISA: £10,000 invested in a global index fund.
- Cash ISA: £6,000 in a 4.5% AER easy-access account.
- Total: £20,000 of his own money + £1,000 LISA bonus = £21,000 working tax-free.
If Daniel buys a first home under £450,000 within 12 months of using the LISA, he can withdraw the LISA balance penalty-free including the £1,000 government bonus.
Worked Example — Family Junior ISA
Sarah and Tom have two children (ages 6 and 9). Sarah uses her £20,000 adult ISA fully. They open Junior ISAs for both children at £3,000 each:
- Sarah's adult ISA: £20,000 (used).
- Child 1 JISA: £3,000 (cap £9,000).
- Child 2 JISA: £3,000 (cap £9,000).
- Family ISA contributions: £26,000 total, all tax-free.
Children's JISA balances belong to the child and are locked until age 18. Grandparents, friends, and other relatives can contribute to a child's JISA as long as the £9,000 annual cap is respected.
UK ISA Reference Table — 2026/27
| ISA Type | Annual Cap | Counts Toward £20k? | Key Feature |
|---|---|---|---|
| Cash ISA | £20,000 | Yes | Tax-free interest |
| Stocks & Shares ISA | £20,000 | Yes | Tax-free gains + dividends |
| Innovative Finance ISA | £20,000 | Yes | Peer-to-peer lending |
| Lifetime ISA | £4,000 | Yes | 25% govt bonus; for 18–39yo only |
| Junior ISA | £9,000 per child | No — separate | Locked until child turns 18 |
| Help to Save | Separate scheme | No | 50% bonus on max £2,400 over 4 years |
Common ISA Scenarios
Maximising LISA + standard ISA
For under-40s, prioritise Lifetime ISA up to the £4,000 cap to capture the 25% government bonus, then fill remaining £16,000 across Cash ISA (short-term savings) and Stocks & Shares ISA (long-term growth). Total: £20,000 contributed + £1,000 LISA bonus = £21,000 working tax-free.
Higher-rate taxpayer: Stocks & Shares first
Higher-rate (40%) and additional-rate (45%) taxpayers benefit most from sheltering investment gains and dividends in a Stocks & Shares ISA. Outside an ISA, dividends above £500 are taxed at 33.75–39.35%; capital gains above £3,000 are taxed at 18–24%. Inside the ISA: zero. Priority: max the Stocks & Shares ISA before topping up a Cash ISA.
First-time home buyer under 40
Open a Lifetime ISA before age 40. Contribute the full £4,000 each year to maximise the £1,000 annual bonus. Money is locked until age 60 or used for a first home under £450,000. Penalty for other withdrawal: 25% (you lose the bonus + 6.25% of your own contribution).
Self-employed nearing retirement
With no employer pension, ISAs provide flexible tax-free retirement income. Stocks & Shares ISA is the workhorse — no income tax on withdrawals, no age restriction. Combined with a SIPP (Self-Invested Personal Pension), you can split contributions: ISA for flexibility, SIPP for upfront tax relief.
Transferring an ISA between providers
Transfers between ISA providers do NOT use your annual allowance. You can transfer a Cash ISA to Stocks & Shares (or vice versa) without limit. Always use the provider's official transfer form — withdrawing and re-depositing counts as a new subscription against your £20,000 cap.
Tips and Considerations
- Use it or lose it. Unused ISA allowance does not roll over. The new tax year starts each 6 April.
- Multiple ISAs of same type allowed. Since April 2024, you can subscribe to multiple Cash ISAs (or Stocks & Shares ISAs) in one tax year, as long as combined contributions stay under £20,000.
- Lifetime ISA is age-restricted. Open between ages 18–39. Contribute until age 50. Withdraw penalty-free for first home or after age 60.
- Beware over-subscription. Exceeding £20,000 in adult ISAs triggers HMRC compliance — the excess is repayable (and gains on the excess are taxable).
- Spouse strategy. Each spouse has their own £20,000 allowance — couples can shelter £40,000/year tax-free. After death, spouses inherit Additional Permitted Subscriptions (APS) equal to the deceased's ISA balance.
- Innovative Finance ISA risk. P2P lending inside an IFISA is not FSCS-protected. Capital is at risk. Suitable only for investors comfortable with higher-risk fixed-income.
Related Calculators
- Compound Interest Calculator — model long-term ISA growth.
- Savings Calculator — reach a savings goal target.
- Pension Calculator UK — workplace and SIPP planning.
- UK Inheritance Tax Calculator — IHT on estates.
- UK Income Tax Calculator — 2026 bands.
Sources & References
- gov.uk — Individual Savings Accounts (ISAs)
- gov.uk — Lifetime ISA
- gov.uk — Junior ISAs
- HMRC ISA Bulletin (annual statistics on ISA usage)
Frequently Asked Questions
What is the ISA allowance for 2026/27?
£20,000 for adults across Cash, Stocks & Shares, Innovative Finance, and Lifetime ISAs combined. Lifetime ISA is sub-capped at £4,000. Junior ISA has a separate £9,000 per-child allowance.
Can I have multiple ISAs?
Yes. Since April 2024, you can subscribe to multiple ISAs of the same type in a single tax year. You can also hold one ISA of each adult type simultaneously. Combined contributions across all adult types must stay within £20,000.
Does Lifetime ISA count toward my £20,000 limit?
Yes. The £4,000 LISA contribution counts toward your £20,000 total. The 25% government bonus is on top — bonuses do not use any of your allowance.
When does the ISA tax year start?
6 April each year through 5 April the following year. Subscriptions are tracked per tax year — unused allowance from 2025/26 does not carry forward into 2026/27.
Is ISA money fully tax-free?
Yes. All interest, dividends, and capital gains inside an ISA are tax-free for the holder. ISAs do not need to be declared on Self Assessment.
Can I withdraw from an ISA without losing the allowance?
For flexible ISAs (most modern Cash and Stocks & Shares ISAs), yes — withdrawals can be repaid within the same tax year without using extra allowance. For non-flexible ISAs and Lifetime ISA, withdrawals do not free up allowance to redeposit.
What happens if I exceed £20,000?
HMRC instructs your ISA provider to repay or untag the excess. Gains on the excess become taxable. Persistent breach can result in HMRC compliance action. The over-subscription is recorded against your record.
Junior ISA vs Lifetime ISA for kids?
Junior ISA: any age, £9,000 limit, locked until 18. Lifetime ISA: minimum age 18 to open. For under-18s, JISA is the only option. From 18, opening a LISA before age 40 captures the 25% bonus for first-home or retirement saving.
Can I transfer between ISA providers?
Yes — transfers between providers (Cash to Cash, Cash to S&S, etc.) do NOT use your annual allowance. Always use the provider's transfer form. Withdrawing and re-depositing is treated as a new subscription.
What is the LISA penalty for early withdrawal?
25% of the amount withdrawn (if not for first home or after age 60). This loses the government bonus AND 6.25% of your own contribution. £4,000 of your money + £1,000 bonus = £5,000 total. Penalty 25% = £1,250 charged. Net to you: £3,750 — less than you put in.
Last reviewed: 18 May 2026. Allowances verified against gov.uk for the 2026/27 tax year. Always confirm with your ISA provider or financial adviser before making contribution decisions.