# Cash ISA rule changes from April 2027: what savers need to know

> Savings & ISAs · Last updated 23 June 2026

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## Quick answer

From April 2027, unused ISA allowances from the previous two tax years can be carried forward and added to the current year's £20,000 limit — but only if you were an ISA holder in those years. The annual allowance itself stays at £20,000.

The government has announced ISA reforms taking effect from 6 April 2027. The headline change is a carry-forward rule: if you did not use your full ISA allowance in the previous two tax years, you can add the unused portion to the current year's subscription limit. This rewards consistent ISA savers without increasing the base allowance.

## Key facts

- The annual ISA allowance remains £20,000 from 2027/28 — it is not being increased
- Unused allowance from the prior two tax years can be carried forward if you held any ISA in those years
- Carry-forward applies across ISA types — Cash, Stocks & Shares, and Lifetime ISAs share the single allowance
- You must have been an ISA subscriber in the carry-forward years — non-holders cannot backfill

## How carry-forward works

Suppose you subscribed £10,000 to an ISA in 2025/26 and £12,000 in 2026/27. From April 2027 you could carry forward £10,000 plus £8,000 unused, giving a total subscription limit of £38,000 for 2027/28 — on top of the standard £20,000.

You must have held an ISA — even with a zero balance — in the years you want to carry forward from. Opening a Cash ISA with £1 now preserves your carry-forward rights.

## Impact on Cash ISA savers

Cash ISA savers who have been unable to max out their allowance each year gain the most. A couple who each carry forward could shelter significantly more from tax in a single year.

The change does not affect existing ISA balances or their tax-free status. It only increases how much new money you can subscribe in a given year.

## Planning before April 2027

If you have never held an ISA, opening one before April 2027 — even with a minimal deposit — ensures you qualify for carry-forward from 2027/28 onwards.

Keep records of your subscriptions each tax year. HMRC tracks ISA subscriptions, but your own records help if there is a dispute with your provider.

## Frequently asked questions

### Does carry-forward apply to Junior ISAs?

No. Junior ISAs have a separate £9,000 annual allowance and are not part of the adult carry-forward rules.

### Can I carry forward unused Lifetime ISA allowance?

The carry-forward applies to the overall £20,000 ISA wrapper. However, Lifetime ISA subscriptions are still capped at £4,000 per year regardless of carry-forward.

### Will Cash ISA rates change because of this?

The rule change does not directly affect rates. However, increased subscription capacity may make Cash ISAs more attractive for larger savers.

## Primary source

https://www.gov.uk/individual-savings-accounts

## Related

- [ISA allowance 2026/27](https://moneyguide.org.uk/savings/isa-allowance-2026-27/)
- [Cash ISA vs Stocks & Shares ISA](https://moneyguide.org.uk/savings/cash-isa-vs-stocks-and-shares-isa/)

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Independent UK money guidance from [Money Guide](https://moneyguide.org.uk). Information only — not regulated financial advice.