Cash ISAs - have I been missing out?

jamtoday202

I have had a Stocks and Shares ISA  but haven't put anything into it for at least four or five years.  I also have cash savings of about £80,000  which are spread across four different savings accounts.  I think I misunderstood the rules and thought that because I had more than £20,000 in my stocks and shares ISA I couldn't have a cash ISA as well.  I've now woken up to the idea,  having had a tax demand for £700, that I need to look at my savings more carefully. Is it correct that in any one financial year I can still have my stocks and shares ISA, not put any money into it but put up to £20,000 of cash into a cash ISA and not pay tax on the interest from this?  Can I move £ 20,000 every financial year,  taking four years in total so that in four years time I won't be paying interest on that cash?

Vitor

Your understanding is correct, except that unless you are above 65 that from 2027 the annual cash ISA limit is dropping to £12,000. However you can open a £20k cash ISA now, add another £20k in April 2026 then £12k in Apr 2027 and subsequent years

poseidon1

jamtoday202 said:

I have had a Stocks and Shares ISA  but haven't put anything into it for at least four or five years.  I also have cash savings of about £80,000  which are spread across four different savings accounts.  I think I misunderstood the rules and thought that because I had more than £20,000 in my stocks and shares ISA I couldn't have a cash ISA as well.  I've now woken up to the idea,  having had a tax demand for £700, that I need to look at my savings more carefully. Is it correct that in any one financial year I can still have my stocks and shares ISA, not put any money into it but put up to £20,000 of cash into a cash ISA and not pay tax on the interest from this?  Can I move £ 20,000 every financial year,  taking four years in total so that in four years time I won't be paying interest on that cash?

A qualified yes to most of your questions.

However if you under age 65, your access to cash isas will be limited to £12k per year from 2027 onwards.

Note you have a S&S ISA, but nothing stopped you using your annual allowance to buy Money Market unit trust funds, which are 'cash like' in their nature.

Four  years of  loss opportunities to avoid tax, so time  to make up for that..

jamtoday202

Thank you, poseidon1. Yes, I've literally paid a high price for being distracted by other things. I'm 65 and now retired so will have time to keep my eye on things... 

Woodstok2000

Just worth saying that although your cash isa allowance will decrease to 12k in 2027, you can still put 20k in total into isas each year, the remaining 8k into a stocks and shares isa.

Hattie627

Woodstok2000 said:

Just worth saying that although your cash isa allowance will decrease to 12k in 2027, you can still put 20k in total into isas each year, the remaining 8k into a stocks and shares isa.

The OP is 65 now, so will be able still to put £20K into a cash ISA each tax year from 6th April 2027, even though the cash ISA annual limit is dropping to £12K for under 65s from April 2027.
Edited to add: and of course the OP can put £20K into a cash ISA for the current tax year and for tax year 2026/27 when it arrives.