When Can You Pay Into an ISA & How Much?
Understand the rules for contributing to your Individual Savings Account. Learn about limits and timing for tax-efficient saving.
Individual Savings Accounts, known as ISAs, offer a way to save or invest without paying UK tax on the interest earned, investment gains, or dividends. Understanding the rules governing contributions is important for anyone considering using an ISA to maximize their savings potential.
Who Can Contribute
Eligibility to contribute to an ISA is primarily based on age and residency status. Generally, an individual must be 18 years or older to open most types of adult ISAs. An exception exists for Cash ISAs, where individuals aged 16 and 17 who held an account before April 6, 2024, may continue to subscribe under transitional arrangements until April 5, 2026. For a Lifetime ISA, the account holder must be between 18 and 39 years old to open the account, though contributions can continue until the age of 50.
Beyond age, a person must be a resident in the UK for tax purposes to contribute to an ISA. This typically means spending at least 183 days in the UK during the tax year. Exceptions apply to Crown employees serving overseas, such as those in the armed forces or diplomatic service, and their spouses or civil partners, who are also eligible to contribute. From April 6, 2025, individuals applying for an ISA will need to provide their National Insurance number if they are eligible for one.
Understanding the ISA Tax Year and Annual Allowance
The ISA tax year runs from April 6th of one year to April 5th of the following year. This specific period dictates when new allowances become available and when previous allowances expire. At the beginning of each new tax year on April 6th, a fresh ISA allowance is granted to eligible individuals.
The annual ISA allowance sets the total amount an individual can save across all their ISA accounts within a single tax year. For the 2025/2026 tax year, this allowance is £20,000. This limit applies to the combined sum contributed to any and all adult ISA types held by the individual. Any unused portion of the allowance from one tax year cannot be carried forward to the next. Contributions can be made as a single lump sum or through regular payments throughout the tax year, both counting towards the overall allowance. It is important to note that transferring funds from ISAs opened in previous tax years to a new or existing ISA does not count towards the current year’s annual allowance.
Contribution Nuances for Each ISA Type
While the overall annual ISA allowance provides a general framework, specific rules apply to how contributions are made to each type of ISA. These nuances determine how much can be paid into particular accounts and under what conditions.
For a Cash ISA, individuals can contribute up to the full annual ISA allowance, currently £20,000, as part of their overall limit. Since April 6, 2024, individuals can contribute to multiple Cash ISAs with different providers within the same tax year. Some Cash ISAs are designated as “flexible,” meaning money withdrawn from the account and re-deposited within the same tax year will not reduce the remaining annual allowance.
A Stocks and Shares ISA also permits contributions up to the £20,000 annual allowance. Since April 6, 2024, it is possible to contribute to more than one Stocks and Shares ISA in the same tax year.
The Lifetime ISA (LISA) carries a specific annual contribution limit of £4,000, which is part of the broader £20,000 overall ISA allowance. This means if someone contributes the maximum to a LISA, they would have £16,000 remaining for other ISA types. Unlike other adult ISAs, only one Lifetime ISA can be opened and contributed to in any single tax year.
Innovative Finance ISAs (IFISAs) allow individuals to invest in peer-to-peer lending platforms within the tax-free wrapper. The annual contribution limit for an IFISA is also £20,000, counting towards the overall ISA allowance. New regulations permit contributions to multiple Innovative Finance ISAs within the same tax year.
Finally, a Junior ISA (JISA) is specifically designed for children under 18. This account has its own annual allowance, which is £9,000 for the 2025/2026 tax year, and this limit is separate from an adult’s ISA allowance. While only a parent or legal guardian can initially open and manage a Junior ISA, anyone can contribute funds to it, such as grandparents or other family members. The money contributed to a Junior ISA is locked in and generally cannot be accessed by the child until they turn 18.