The 2027 ISA changes, plainly

On 6 April 2027 the ISA rules change. The headlines sound alarming, but most of it is narrower than it looks. Here's what's actually happening, in plain English — this is general information, not advice on what to do.

The cash-ISA limit becomes £12,000 for under-65s

Today you can pay your whole £20,000 ISA allowance into cash ISAs if you want. From 6 April 2027, if you're under 65, the most you can put into cash ISAs in a year is £12,000. People aged 65 and over keep the full £20,000 in cash.

The overall allowance is unchanged

This is the part most coverage skips: the overall ISA allowance is still £20,000. You just can't put more than £12,000 of it into cash. The rest — up to £20,000 in total — can still go into a Stocks & Shares ISA or a Lifetime ISA. Nothing about the £20,000 total, or your existing ISA balances, changes.

Cash inside a Stocks & Shares ISA gets a 22% charge

A Stocks & Shares ISA is meant for investments, but people often leave some of it sitting in cash. From 6 April 2027, the interest on that uninvested cash is charged at 22% (the new basic savings rate). Cash held in an ordinary cash ISA is unaffected — this only touches cash left inside an investment ISA.

Moving invested ISA money to cash becomes one-way

Right now you can transfer money from a Stocks & Shares ISA into a cash ISA. From 6 April 2027, for under-65s, that door closes: invested ISA money can no longer be moved across to cash. Transfers the other way — cash into investments — still work. It's information worth knowing before the date, not a nudge to move anything.

None of this affects money already in your ISAs, and none of it is a reason to rush. It's a change to how much NEW money can go where, from one date. What suits you depends on your own goals and timeframe.