ISA changes 2027: what the Budget changed

ISA changes 2027: what the Budget kept and what is still open

The Budget on 28 October 2026 cancelled the planned cut to the Cash ISA limit, so it stays £20,000 for everyone over 18. Savings interest tax rises to 24%, 44% and 49% from 6 April 2027. The 22% charge on cash in investment ISAs and the transfer block are not in the Budget documents and are unconfirmed.

The short answer

Cancelled: the cut of the Cash ISA limit to £12,000 for under-65s. The limit stays £20,000 at every age (HM Treasury, 28 October 2026).

Confirmed: tax on savings interest outside an ISA rises to 24%, 44% and 49% from 6 April 2027. Interest inside a Cash ISA stays tax-free.

Unconfirmed: the 22% charge on cash in Stocks and Shares ISAs and the transfer block. The Budget documents do not mention them, and press reports say they are not going ahead as planned.

The £20,000 overall allowance, the £4,000 Lifetime ISA limit and the £9,000 Junior ISA limit do not change.

What is changing in April 2027?

The Budget on 28 October 2026 changed the picture. HM Treasury’s Budget document says the government “has decided not to reduce the cash ISA limit, so that it remains at £20,000”, and the tax overview says that applies to all savers over 18 from April 2027. Here is where each earlier plan now stands.

Change	Status after the Budget	Detail
Cash ISA limit falls from £20,000 to £12,000 for savers 64 or under	Cancelled. The limit stays £20,000 at every age.	Cash ISA limit
Tax on savings interest outside an ISA rises to 24% basic rate, 44% higher rate, 49% additional rate	Confirmed in the Budget. Two points announced in 2025, and a further two points on 28 October 2026.	Savings tax 2027
22% charge on interest from cash held inside a Stocks and Shares or Innovative Finance ISA	Unconfirmed. Not in the Budget documents. Press reports say it is not going ahead as planned.	The planned 22% charge
A Stocks and Shares or Innovative Finance ISA cannot be 100% cash-like (money market funds)	Unconfirmed. Part of the same package as the 22% charge.	Cash-like holdings
Transfers from a Stocks and Shares or Innovative Finance ISA into a Cash ISA blocked for under-65s	Unconfirmed. Not in the Budget documents. Press reports say it is not going ahead as planned.	Transfers and the Cash ISA limit

“Unconfirmed” means we have not found an official statement either way. The Budget document and the tax overview we read do not mention the 22% charge, the cash-like holdings rule or the transfer block, while HMRC’s pages from before the Budget still describe them. MoneySavingExpert reported on Budget day that the government confirmed they will not go ahead as planned, and Which? reported they will likely be dropped. We will update this page when HMRC or the Treasury says which it is.

ISA allowance 2027/28

The overall ISA allowance stays at £20,000 a year, and the Cash ISA limit stays £20,000 too. You can put all of it into Cash ISAs, split it across ISA types, or save less. See how the £20,000 splits across ISA types.

ISA tax changes: will ISAs be taxed?

No: interest earned inside a Cash ISA stays tax-free, and none of the changes taxes it. Tax on savings interest outside an ISA rises from 6 April 2027, to 24% for basic rate taxpayers, 44% for higher rate and 49% for additional rate, which makes the tax-free wrapper worth more. See will Cash ISAs be taxed.

What is not changing?

The Personal Savings Allowance, the interest you can earn tax-free outside an ISA, is £1,000 for basic rate taxpayers, £500 for higher rate and £0 for additional rate. Cash ISA savings you already hold are untouched, and transfers from one Cash ISA to another are unaffected.

Staying the same, at a glance

Overall ISA allowance: £20,000; Across all your adult ISAs
Cash ISA limit: £20,000; Cut to £12,000 cancelled
Lifetime ISA limit: £4,000; Counts inside the £20,000
Junior ISA limit: £9,000; Separate from the adult allowance

What else did the Budget say about ISAs?

A new incentive for first-time investors. The Budget document says the government will work with the investment industry to explore a new ISA incentive for people investing in a Stocks and Shares ISA for the first time, with the detailed design to be developed with industry. There are no rules, amounts or dates yet.

First Time Buyer ISA. The Budget document says the government will introduce a First Time Buyer ISA from April 2029. It keeps the Lifetime ISA’s up to £4,000 a year and 25% bonus, paid on the balance when funds go towards a first home up to £450,000, with no upper age limit. Existing Lifetime ISA holders can keep their accounts under the current rules. See what the government has proposed.

Lifetime ISA withdrawals. From 29 October 2026, Lifetime ISA funds can be used for a first home above the £450,000 cap, if the purchase otherwise meets the rules, with a reduced 20% withdrawal charge. The charge for other unauthorised withdrawals stays at 25%.

What could still change. The Cash ISA limit decision is made by regulations the government says it will lay in November 2026. Confirm anything time-critical on gov.uk.

Key dates

28 October 2026: Autumn Budget 2026. The Cash ISA cut was cancelled.
November 2026: the government says it will lay the regulations that keep the limit at £20,000.
5 April 2027: the last day of the 2026/27 tax year, when your 2026/27 allowance ends. See the ISA deadline.
6 April 2027: the new tax year starts, and tax on savings interest outside an ISA rises to 24%, 44% and 49%.

Questions people ask

Is the ISA allowance changing in 2027?

No. The overall allowance stays at £20,000 a year, and so does the Cash ISA limit. The planned cut of the Cash ISA limit to £12,000 for under-65s was cancelled in the Budget on 28 October 2026.

Will ISAs be taxed from April 2027?

Not Cash ISA interest, which stays tax-free. Tax on savings interest outside an ISA rises to 24%, 44% and 49% by tax band. A planned 22% charge on interest from cash inside Stocks and Shares and Innovative Finance ISAs is unconfirmed after the Budget. See will Cash ISAs be taxed.

Does my age matter for the Cash ISA limit?

No. The age-65 test belonged to the cancelled £12,000 plan. The Cash ISA limit stays £20,000 for every saver over 18.

Does opening more than one Cash ISA matter for the limit?

The limit covers your total subscriptions across all your Cash ISAs and other ISAs in a tax year, not each account. With the Cash ISA limit at £20,000, it equals your overall ISA allowance.

Is the Cash ISA limit decision law yet?

Not yet. HM Treasury's tax overview says the change will be made by secondary legislation to be laid before Parliament in November 2026. The regulations made in September 2026 had set the £12,000 limit, so watch for the new ones.

Is the First Time Buyer ISA one of the 2027 changes?

No. The Budget document says the government will introduce it from April 2029, to retain the Lifetime ISA's generosity. Existing Lifetime ISA holders can keep using their accounts. See what the government has proposed.

Keep reading

Cash ISA limit: the £12,000 cut is cancelled The Budget on 28 October 2026 cancelled the £12,000 Cash ISA limit for under-65s. The limit stays £20,000 at every age. What was planned and what is next.

Alternatives to a Cash ISA: other places to save The Cash ISA limit stays £20,000, but a Cash ISA is not the only home for savings. Other ISAs, savings accounts and Premium Bonds, side by side.

ISA allowance and limit 2026/27: how the £20,000 splits The 2026/27 ISA allowance and limit is £20,000, shared across cash, Stocks and Shares, innovative finance and Lifetime ISAs. How it splits, and what changes.

When is the ISA deadline? The ISA deadline for 2026/27 is midnight on 5 April 2027. Unused allowance is lost, and a new £20,000 allowance starts on 6 April 2027.

Should you fill your Cash ISA before April 2027? The £12,000 Cash ISA cap was cancelled on 28 October 2026, so there is no cash limit change to beat in April 2027. What the 5 April deadline still means.

How does an ISA transfer work? Move an ISA by asking your new provider to transfer it, not by withdrawing the cash. How transfers work, how long they take, and what changes in 2027.