What is the ISA allowance for 2025/26?
The annual ISA allowance was renewed at the start of the new financial year on 6th April 2025, including the Stocks and Shares ISA allowance. This may have raised questions about the Stocks and Shares ISA rules and how it works, so we’ve broken down all you’ll need to know for your ISA allowance in the 2025/26 financial year.
Annual ISA Allowance at a Glance
| 2025/2026 | 2024/2025 | |
|---|---|---|
| ISA Annual Allowance | £20,000 | £20,000 |
| Junior ISA Annual Allowance | £9,000 | £9,000 |
What is an ISA allowance?
An ISA allowance is the total amount of money you can save or invest across ISAs within one financial year without paying income tax or capital gains tax on any returns or interest. Your allowances across various investment schemes have the potential to change each year, which is why it’s important to keep up to date with the current year’s allowance.
In the UK, there are four main types of ISA:
- Cash ISAs
- Stocks and shares ISAs
- Innovative finance ISAs
- Lifetime ISAs
You can choose to open ISAs with more than one provider and choose a mixture of ISAs within a tax year, providing you don’t exceed the maximum annual allowance across all the ISAs you hold. It is important you check your eligibility for each type of ISA, and remember, you can only pay into one Lifetime ISA in a single tax year (up to £4,000).
Historical ISA allowances: At a Glance
See how the ISA allowance limits have changed over time below:
| Tax Year | Annual ISA Allowance |
|---|---|
| 2024/25 | £20,000 |
| 2023/24 | £20,000 |
| 2022/23 | £20,000 |
| 2021/22 | £20,000 |
| 2020/21 | £20,000 |
| 2019/20 | £20,000 |
| 2018/19 | £20,000 |
| 2017/18 | £20,000 |
| 2016/17 | £15,240 |
| 2015/16 | £15,240 |
| 2014/15 | £15,000 |
Stocks and Shares ISA Rules for 2025/26
For the 2025/26 financial year, you can save or invest up to £20,000 tax-efficiently in your Stocks and Shares ISA. The UK government review and set the stocks and shares ISA limit every April.
This £20,000 can all be invested in a single ISA, split across more than one ISA with different providers or split between different types of ISA such as a cash ISA or Lifetime ISA. However, you can only pay into one Lifetime ISA in a single tax year (up to £4,000) .
At Shepherds Friendly, our Stocks and Shares ISA is a great way to invest from £30 a month, while also allowing more potential for growth than a cash-based savings account. In a stocks and shares ISA, your money is invested across stocks, shares, equities, bonds, and property.
Junior ISA allowance for 2025/26
A Junior ISA (JISA), or child’s ISA, is a tax-efficient savings or investment account which allows you to give a tax-free lump sum to your child as soon as they turn 18.
The Junior ISA allowance is £9,000 for the current tax year, which is different from adult ISAs. This is the maximum total amount that can be deposited into a Junior ISA before the next tax year (beginning April 6th 2026).
A child can only hold one stocks and shares Junior ISA each tax year, but they can also hold a cash Junior ISA. The Junior ISA allowance can be spread across both types of plan, as long as you do not exceed the overall allowance.
How can you use your ISA allowance?
When considering how to best use your ISA allowance, there are two main options:
- You can use your ISA allowance in full for a single ISA, such as a stocks and shares ISA, paying in up to £20,000.
- You can split your ISA allowance across more than one ISA, with different providers, with the rule that you don’t pay in any more than £20,000 across all investment.
Stocks and shares ISAs can include investments in:
- Shares in companies
- Unit trusts and investment funds
- Corporate bonds
- Government bonds
Cash ISAs can include:
- savings in bank and building society accounts
- some National Savings and Investments products
Whichever option you choose, remember you also need to be very careful not to save more than the overall limit of £20,000, otherwise you may be liable for tax on your returns.
If you want your money to make the most of your new ISA allowance in 2025/26, it’s wise to start investing sooner rather than later. As mentioned, this allowance will only last until April 2025; if you don’t use it, you can’t carry any unused allowance over to the following tax year.
Using your allowance to invest in a stocks and shares ISA
The most important thing to remember about opening a stocks and shares ISA is that it carries a higher risk than a bank or building society cash ISA.
As the fund is invested in stocks and shares, there are inevitably risks associated with the performance of financial markets. Unlike a cash-based savings account, where there is normally a set or guaranteed rate of interest on your savings, the returns for a stocks and shares ISA depends on the financial market, meaning that you may get back less than you put in.
Because of this, a stocks and shares ISA should always be considered a medium to long-term (5 years plus) investment. Making regular withdrawals from your stocks and shares ISA may negatively affect the purchasing value of your investment. Similarly, if you withdraw from the investment early for any reason, it may mean you get less back than you expected.
Be sure to read through our Important Information Guides for all the key information about our Stocks and Shares ISA. Remember that when you invest, your capital is at risk.
More information about stocks and shares ISAs
FAQs: Everything you need to know about the Stocks and Shares ISA allowance
When does the ISA allowance renew?
The tax year, set by HM Revenue & Customs, ends at midnight on 5th April each year. This means that you get a new ISA allowance starting on the 6th April each year.
If you are looking to maximise the use of your ISA allowance this financial year, then it is important to remember that the deadline to do so is the 5th April 2025 as allowances do not rollover if you haven’t used it all.
Does the ISA allowance roll over if I don’t use it?
No, it doesn’t. Your ISA allowance renews each year. If you don’t use your full ISA limit before the end of the tax year (which is at midnight on 5th April) then your ISA allowance for the current tax year has gone and can no longer be used. It’s not possible to roll over any unused allowance. For example, if you save £10,000 into your ISA this tax year, you can’t add £30,000 into your ISA next year within the tax-free limit. Your ISA allowance would remain at £20,000 (unless the Government changed the ISA limit amount).
If I transfer my ISA does it affect my annual allowance?
Transferring your ISA from one ISA provider to another does not affect your annual allowance. You still can save up to the annual limit of £20,000 for this financial year.
You’re free to transfer and split your ISA allowance any way you like across a Stocks and Shares ISA, Cash ISA, Lifetime ISA (maximum of £4,000) and an Innovative Finance ISA, as long as you stay within the overall limit.
However, there are a couple of stocks and shares isa transfer rules that you need to be aware of. Be careful when transferring a stocks and shares or cash ISA into a Lifetime ISA. While this won’t affect your overall annual ISA subscription allowance for that tax year, it will count towards your annual Lifetime ISA subscription limit of £4,000.
This also applies to if you are transferring your savings from a previous tax year. This won’t count towards your allowance for the current year. Be sure to ask your ISA provider to help you with the transfer to avoid going over your current tax year allowance.
What happens if I go over my Stocks and Shares ISA limit?
It’s important you are aware of the ISA allowance each tax year to avoid exceeding the annual limit. For the 2025/26 tax year the Stocks and Shares ISA limit is £20,000.
If you do exceed your ISA limit, the best thing to do is contact HMRC by calling their helpline on 0300 200 3300 and explaining your situation. They will help you work out which payment breached the limit and reclaim the money for you. There may be a charge for any tax due. If you don’t let them know, HMRC will get in touch to let you know how to correct your mistake at the end of the tax year.
Summary: Things to remember about the ISA allowance
- • The current ISA allowance for 2025/26 tax year is £20,000.
- • You can split your ISA allowance across more than one ISA, with different providers, with the rule that you don’t pay in any more than £20,000 across all investment.
- • You’re free to split your ISA allowance any way you like across a Stocks and Shares ISA, Cash ISA, Lifetime ISA (maximum of £4,000) and an Innovative Finance ISA, as long as you stay within the overall limit.
- • Your ISA allowance renews at midnight on 5th April.
- • Unused allowance can’t roll over to the next financial year.
- • If you exceed your ISA limit, call HMRC on 0300 200 3300.
Important things to consider
- Past performance cannot be taken as a guarantee of future returns.
- Bonus rates vary from year to year depending on the performance of our investments and in some years we may not pay out any at all.
- HM Revenue and Customs may change the tax status of an ISA in the future.
- Inflation and making regular withdrawals may affect the purchasing value of your investment in the future.
- If you have been invested through periods of poor investment performance, and you leave the fund, you may get back less than the current value of your plan. This is known as a Market Value Reduction (MVR)
When you take out an investment product with us your capital is at risk and you may get back less than you have put in. All references to taxation are to UK taxation and are based on Shepherds Friendly Society’s understanding of current legislation and H M Revenue and Customs practice which may change in the future. Investment growth is by means of bonuses, the amount of which cannot be guaranteed throughout the term of the contract. Please ensure that you read the full terms and conditions of this plan which are available from your financial adviser or by contacting us directly.
Please note: No advice has been given by Shepherds Friendly, and if you are in any doubt as to whether an investment plan is suited to your needs, then you should contact a financial adviser. There may be a charge for financial advice, and the cost should be confirmed to you before any advice is given.