Cash ISA limit 2027: £20,000 allowance stays after planned cut scrapped

4th November 2026

The Cash ISA limit will stay at £20,000 a year for everyone, after the government scrapped a planned cut to £12,000 for under-65s. If you were worried about losing your tax-free savings allowance from April 2027, you can relax.

💷 Cash ISA limit 2027: the key facts
✅ Cash ISA allowance stays at £20,000 a year, for all ages
❌ Planned cut to £12,000 for under-65s from April 2027 scrapped
❌ Proposed 22% charge on cash held in stocks and shares ISAs also dropped
💡 Government to look at a bonus for first-time investors
🏛️ Announced by Chancellor John Healey in the Budget on 28 October

Cash ISA cut SCRAPPED. The limit will stay at £20,000 tax-free for people of all ages.
— Martin Lewis (@MartinSLewis) @MartinSLewis

Martin Lewis reacts on X

What was going to happen?

In last year’s Budget, the then Chancellor Rachel Reeves announced that from April 2027 under-65s would only be able to put £12,000 a year into a Cash ISA, out of their overall £20,000 ISA allowance. The idea was to push more savers into stocks and shares. Further plans in June would have added a 22% charge on interest earned on cash held inside stocks and shares ISAs.

What has changed?

In his Budget on 28 October, Chancellor John Healey scrapped the cut. The Cash ISA limit stays at £20,000 for people of all ages, and the other proposed restrictions will not go ahead.

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Martin Lewis explains the change on ITV’s This Morning

What is the new “starter ISA” idea?

Instead of forcing people out of cash, the government says it will work with banks and investment firms on an incentive for people opening a stocks and shares ISA for the first time. Martin Lewis, who campaigned against the cut, said his idea was a bonus of around 10% to 15% on the first £2,000 to £3,000 a new investor puts in, though no details have been confirmed.

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What should savers do now?

Nothing changes: you can still save up to £20,000 a tax year into ISAs, all in cash or split between different types. The tax year runs until 5 April, so check your bank’s best rates and use your allowance if you can.

Sources: MoneySavingExpert, HM Treasury Budget 2026, Martin Lewis on X, ITV This Morning. This is not financial advice. Photo: stevepb / Wikimedia Commons, CC0.