Cash ISA rule changes from April 2027: what savers need to know
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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.
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Read the full savings & ISAs guide →Primary source: www.gov.uk/individual-savings-accounts
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.
Common 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.