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Tax wrappers · 2026/27

The ISA is a box. Fill it on purpose.

An Individual Savings Account does not invest for you. It is a legal wrapper. What you put inside — cash, funds, shares, peer-to-peer notes — still rises and falls. What the wrapper does is keep UK tax off the growth and the withdrawals, within the annual limit.

The 2026/27 allowance

Adults can subscribe up to £20,000 across their ISAs in the tax year that runs from 6 April 2026 to 5 April 2027. Unused room does not roll forward. Junior ISAs have a separate £9,000 limit. A Lifetime ISA accepts up to £4,000, and that £4,000 counts toward the £20,000.

You can split the allowance between Cash, Stocks and Shares, Lifetime and Innovative Finance ISAs. You may now pay into more than one ISA of the same type in a year, provided the combined subscriptions stay inside the cap. Transfers of previous years' ISAs do not use this year's allowance.

From 6 April 2027 the government intends to cap Cash ISA subscriptions at £12,000 a year for people under 65, with the rest of the £20,000 available for other ISA types. The 2026/27 year still allows the full amount in cash if you choose. If you are building a long-term portfolio, the more interesting question is not the 2027 headline — it is whether cash is the right asset for money you will not need for a decade.

Stocks and shares ISAs

This is the wrapper most beginners mean when they say they should start investing. Inside it you can hold funds, ETFs, investment trusts and individual shares. Dividends and capital gains inside the ISA are not taxable, do not use your £500 dividend allowance or £3,000 CGT exempt amount, and do not need to be reported to HMRC.

You can sell and withdraw whenever you like. There is no minimum holding period. If the ISA is not a flexible ISA, money you take out cannot be replaced without using fresh allowance. Check that detail before you treat an ISA like a current account.

Cash ISA

Savings, not investments. Useful for emergency cash if you want the tax wrapper. No market risk; inflation risk remains.

Stocks & shares ISA

Funds, ETFs and shares. Market risk. The default long-term wrapper for beginners who have a cash buffer.

Lifetime ISA

Open from 18–39. 25% bonus on up to £4,000 a year. First home (up to the scheme's price cap) or age 60. 25% charge on most other withdrawals.

Junior ISA

£9,000 for 2026/27. The child takes control at 18. Cannot be accessed earlier except in very limited circumstances.

Innovative Finance ISA

Peer-to-peer lending and similar. Higher risk, less liquidity, not a beginner default. FSCS protection often does not apply in the way it does to bank cash.

A parent and child counting coins into a ceramic jar at a kitchen table

Junior ISAs, without the guilt

A Junior ISA is optional. Plenty of families put the parent ISA and the workplace pension first, because adult tax wrappers are larger and more flexible. If you do fund a JISA, a low-cost global fund on a long clock is the same logic as an adult ISA — just locked until 18.

At 18 the account becomes an adult ISA. Talk to the young person before then. A surprise portfolio is a weaker lesson than a shared habit of contributing a little, often.

Wrapper	2026/27 limit	Age to open	Access
Stocks & shares ISA	Share of £20,000	18+	Anytime
Cash ISA	Share of £20,000	18+	Anytime (unless fixed)
Lifetime ISA	£4,000 (inside the £20,000)	18–39 to open	First home or 60; else 25% charge
Junior ISA	£9,000	Under 18 (opened by parent/guardian)	At 18

Crocinxeno is not authorised by the Financial Conduct Authority and does not provide personal financial advice, recommendations or promotions of specific products. Investing involves risk. The value of investments and the income from them can fall as well as rise. Tax treatment depends on your circumstances and may change.