Need help reading this page? Click to activate Recite Me popup.

2025 Budget update

Changes to ISAs from 06 April 2027

The government announced changes to Individual Savings Accounts (ISAs) in the 2025 Budget. These start from 06 April 2027.

Until 06 April 2027 everyone can split their £20,000 ISA allowance between the available ISA types in line with the current rules.

From 06 April 2027, your overall £20,000 ISA allowance remains the same. But there are new rules for cash ISAs if you’re under 65.

Cash ISA changes

New rules for Cash ISAs if you’re under 65

From 06 April 2027, if you’re under 65, the Cash ISA limit will drop from £20,000 to £12,000.

You can still use the remaining £8,000 in other types of ISAs such as a Stocks and Shares or Innovative Finance ISA, or a maximum of £4,000 into a Lifetime ISA (LISA). We don't offer Innovative Finance ISAs or LISAs at the moment.

No changes for over 65s

If you’re 65 or older, you can still put the full £20,000 into a Cash ISA.

Other ISA limits stay the same:

  • Lifetime ISA is £4,000 and counts as part of your overall £20,000 ISA allowance.
  • Junior ISA / Child Trust Fund is £9,000 for each child, separate to your £20,000 ISA allowance.

Stocks and Shares ISA updates

The allowance stays at £20,000

The overall allowance across all ISA types stays at £20,000, so you can choose to put all of this into a Stocks and Shares ISA.

Breaking down the ISA changes

What does this mean for you?

The basics don’t change:

  • Cash savings can be best suited for short-term goals.
  • Considering investing might help your money grow over time.

Why the changes?

The government wants more people to think about investing for the long term. In the Budget speech, the Chancellor said that historically, investments have grown more than cash savings.

See how your money could grow

Of course, what’s happened before isn’t a guarantee of what will happen in the future. But it’s interesting all the same to compare the 10-year journey of cash savings and investments.

Graph comparing investing vs. savings over 10 years: £1,000 invested in S&P World Index (2015) is worth £2,659 in 2025; in a typical savings account it would be worth £1,229 in 2025.

Sources

Savings – MoneyFacts, 12m fixed Non-ISA rates, January 2025.

Investments – S&P Dow Jones Indices, S&P World Index (GBP). Excludes fees and does not include any dividends or reinvestment.

These figures refer to the past and past performance is not a reliable indicator of future performance. See a data breakdown of the performance in the table.

Simple ways to grow your money

Make the most of your ISA allowance

ISAs are one of the best ways to save and invest in a tax-efficient way. And from 06 April 2027, that matters even more:

  • Tax on savings interest outside ISAs will go up by 2%.
  • New rates: 22% (basic), 42% (higher), 47% (additional).

As well as this, rates of Income Tax applicable to dividend income are changing.

From 06 April 2026, the basic rate will be increased by 2% to 10.75% and the higher rate will be increased by 2% to 35.75%. The additional rate will remain unchanged at 39.35%. 

Using a Stocks and Shares ISA could help you stay tax-efficient.

Investing in your future

If you want to use your full ISA allowance from 06 April 2027, we’ve got options to help:

New to investing? Start small – you can invest from £50 a month with our Ready-Made Investment ISA. Or set up a regular plan with no trading fees on our Stocks and Shares ISA.

Thinking about ISA transfers?

Transfers keep your ISA tax benefits – but make sure you do it properly. Don’t take out the money into a normal account during the process. We can help with transfers.

If you're considering moving money between Cash ISAs and Stocks and Shares ISAs, think about your goals and make sure this decision is right for you. Cash is lower risk, but inflation can eat into its buying power. Investments can potentially offer more growth if you’ve got time on your side.

Investing for longer increases the likelihood of positive returns. Over a period of 5 years or more, investments usually give you a higher return compared to cash savings. But investments can go down as well as up in value, so you could get back less than you put in. Tax treatment depends on individual circumstances and may be subject to change in the future.

Protecting your money



The Financial Services Compensation Scheme (FSCS) protects the eligible money you hold with us.

More about the FSCS



Protecting your money

FSCS logo

The Financial Services Compensation Scheme (FSCS) protects the eligible money you hold with us.

More about the FSCS

You might also like

ISAs explained

Everything you need to know about ISA’s.

ISAs explained

ISA allowances

Current limits for all ISA types.

ISA allowances

Savings or investments or both?

Find the right mix for you.

Savings or investments

Important legal information

Halifax Share Dealing Limited. Registered in England and Wales no. 3195646. Registered Office: Trinity Road, Halifax, West Yorkshire, HX1 2RG. Authorised and regulated by the Financial Conduct Authority under registration number 183332. A Member of the London Stock Exchange and an HM Revenue & Customs Approved ISA Manager.