Can I Put £20,000 in an ISA Every Year?

The annual ISA limit is £20,000 per tax year. Learn how ISA allowances work, types of ISAs, and whether you can exceed the £20,000 limit.

ISAs (Individual Savings Accounts) allow UK savers to grow money tax-free, making them one of the best ways to save and invest efficiently. But can you put £20,000 into an ISA every year? The answer is yes, but there are important rules to follow.

This guide explains how the ISA allowance works, contribution limits, Lifetime ISA rules, and whether you can contribute to someone else’s ISA.

How Does the Annual ISA Allowance Work?

  • The annual ISA allowance for 2024/25 is £20,000.

  • You can split this allowance across different types of ISAs.

  • The allowance resets on 6 April each tax year—unused allowance does not carry over.

You can invest the full £20,000 in one ISA or spread it across multiple ISAs, as long as you do not exceed the £20,000 total limit.

How Much Money Can I Put Into ISAs?

  • You can invest up to £20,000 per tax year.

  • The full amount can go into one ISA or be split across multiple types.

Example: How You Can Use Your ISA Allowance

  • Cash ISA: Contribution £5,000

  • Stocks & Shares ISA: Contribution £10,000

  • Innovative Finance ISA: Contribution £3,000

  • Lifetime ISA (LISA): Contribution £2,000 (£4,000 max, but must not exceed £20,000 total)

  • Total £20,000

You cannot exceed £20,000 across all ISAs combined.

What is the Annual Allowance Limit for Lifetime ISAs?

  • The Lifetime ISA (LISA) allowance is £4,000 per tax year.

  • The government adds a 25% bonus (up to £1,000 per year).

  • LISA funds can only be used for a first home purchase or retirement (after age 60).

LISA contributions count toward the £20,000 annual ISA allowance, so if you put £4,000 in a LISA, you have £16,000 left to invest in other ISAs.

How Much Money Are You Allowed to Pay Into Someone Else’s ISA?

You cannot directly contribute to someone else’s ISA, however, you can gift them money, which they can then deposit into their own ISA. Parents can contribute to a child’s Junior ISA, up to the £9,000 annual limit.

What Types of ISAs Are There?

  • Cash ISA – Tax-free savings account.

  • Stocks & Shares ISA – Invests in stocks, bonds, and funds.

  • Innovative Finance ISA – Peer-to-peer lending investments.

  • Lifetime ISA (LISA) – For first home purchases or retirement (max £4,000 per year).

  • Junior ISA (JISA) – Savings account for children under 18 (max £9,000 per year).

You can hold multiple ISAs, but you can only pay into one of each type per tax year.

Annual Allowance Limit for Each Type of ISA

Cash ISA: Annual Allowance 24/25 Up to £20,000

Stocks & Shares ISA: Annual Allowance 24/25 Up to £20,000

Innovative Finance ISAUp to £20,000: Annual Allowance 24/25

Lifetime ISA (LISA): Annual Allowance 24/25 Up to £4,000 (included in £20,000 limit)

Junior ISA (JISA): Annual Allowance 24/25 Up to £9,000 (separate allowance)

  • You cannot pay into two Cash ISAs in the same tax year.

  • You can mix contributions across different ISAs, as long as the total does not exceed £20,000.

Can I Put More Than £20,000 in an ISA?

You cannot exceed the £20,000 ISA allowance per tax year. However, you can invest £20,000 every year, meaning:

  • Over five years, you could contribute £100,000 tax-free.

  • Over 10 years, you could save £200,000 tax-free.

You can have multiple ISAs from previous years and continue earning tax-free interest and returns on those funds.

Five ISA Myths Exposed

Myth 1: "I can only have one ISA."

  • ❌ False – You can hold multiple ISAs but can only pay into one of each type per tax year.

Myth 2: "If I don’t use my £20,000 allowance, it rolls over."

  • ❌ False – Unused ISA allowances do not carry forward to the next tax year.

Myth 3: "I can transfer money freely between ISAs."

  • ❌ False – Transfers must be done through an official ISA transfer process to maintain tax-free status.

Myth 4: "I can contribute to someone else’s ISA."

  • ❌ False – You cannot contribute directly to someone else's ISA, but you can gift them money.

Myth 5: "ISAs are completely tax-free forever."

  • ❌ False – While ISAs are free from UK income and capital gains tax, they may be subject to Inheritance Tax (IHT) if passed to beneficiaries.

Final Thoughts

  • You can put £20,000 in an ISA every year, and the allowance resets each tax year.

  • You can split contributions across different ISAs but cannot exceed £20,000 total.

  • LISA contributions are capped at £4,000 per year and count toward your ISA limit.

  • If you accidentally exceed your allowance, contact HMRC immediately.

To check current ISA rules and limits, visit GOV.UK.