The ISA allowance for 2023/24 is £20,000, unchanged from the last tax year. This means you can pay £20,000 into ISAs this year from 6 April to 5 April.
£20,000 allowance for 2023/24.
The tax year runs from 6 April to 5 April.
The limit counts across all types of ISA.
How does the ISA allowance work?
The ISA allowance is how much you can pay into an ISA during a tax year. The £20,000 limit applies across Cash ISAs, Stocks and Shares and Innovative Finance ISAs. Yorkshire Building Society only offers Cash ISAs.
This means you could split your allowance across those three ISA types, as long as the total is £20,000 or less.
You can also pay into a Lifetime ISA as part of your allowance. There’s a limit to how much of your allowance you can use in a Lifetime ISA.
Allowances for different ISA types
While you can pay £20,000 into ISAs in total, there are limits for how you much you can pay into each type:
Cash ISA – £20,000 per tax year.
Stocks and Shares ISA – £20,000 per tax year.
Innovative Finance ISA – £20,000 per tax year.
Lifetime ISA – £4,000 per tax year, but you must make your first payment before you are 40 years old. You can’t pay into a Lifetime ISA after the age of 50.
ISA allowance example
For example, you could pay the following in a single tax year:
£10,000 into a Cash ISA
£6,000 into a Stocks and Shares ISA
£4,000 into a Lifetime ISA
What happens if you pay more than £20,000 into ISAs in a tax year?
How does transferring an ISA affect your allowance?
You can transfer some or all of your money saved in previous tax years into a Cash ISA, Stocks & Shares ISA, Innovative Finance ISA or Lifetime ISA without affecting your annual allowance.
For example, if you transfer a Cash ISA from the previous year, it won’t count towards the allowance of the current tax year.
Be careful not to close the Cash ISA, withdraw the money, then pay into a new Cash ISA. This can mean losing tax-free status.
Always check for charges if you plan on transferring an ISA to a new provider.
When does the ISA allowance reset?
The ISA allowance resets at the end of each tax year, which is 5 April. You can’t carry any allowance over into the next year, it will reset to the limit again once the new tax year starts on 6 April.
Withdrawing and your ISA allowance
If the ISA you are saving with allows you to withdraw, you can take money out and pay it back in, as long as the new total is within the ISA allowance. ISAs that allow you to take money out and pay it back in the same tax year are called “flexible” ISAs.
For example, if you had £20,000 in a Flexible Cash ISA, then you withdrew £2,000, you could pay another £2,000 back in within the same tax year.
Does a junior ISA count towards your ISA allowance?
No, saving into a Junior ISA for a child or grandchild won’t count towards your ISA allowance. The allowance for Junior ISAs is £9,000 for the tax year.
The content on this page is for reference and does not constitute financial advice. For impartial financial advice, try MoneyHelper.