ISA Allowances

NebulaNova

Hi, I have a T212 ISA which is maxed out. I'm confused as to what happens in April in terms of having a new ISA allowance.

Am I able to simply add another £20k into the same ISA, or do I have to open another one with someone else? If adding to the existing one, surely that gets confusing if you decide to move money around and how would HMRC know what money is from which ISA year?

Also, from 2027, the limit for ISA's is £12,000. Does this mean I won't be able to transfer a maxed out £20k ISA to a new one with a better rate once the limit is £12,000?

Thanks

sausage_time

You can add to your existing T212 ISA in April for the new financial year.

Because T212 is a Flexible ISA you can withdraw that £20k and pay into another ISA if you wish.  If you want to move the £20k from this year (plus any interest) after April you would have to initiate a transfer from a new ISA.

https://www.moneysavingexpert.com/savings/flexible-isas/

https://www.gov.uk/individual-savings-accounts/how-isas-work

vacheron

If adding to the existing one, surely that gets confusing if you decide to move money around and how would HMRC know what money is from which ISA year?

HMRC don't need to know. The whole point of ISAs is that HMRC do not consider anything held inside of them.

Also, from 2027, the limit for ISA's is £12,000. Does this mean I won't be able to transfer a maxed out £20k ISA to a new one with a better rate once the limit is £12,000?

You can transfer as much money already in ISAs as you like. You just will be limited to adding £12,000 of new money into ISAs each year.

NebulaNova

Thanks both. So technically I could have £40k in a T212 ISA once April 2026 is here? Is it obvious that the two amounts are separate within the same ISA?

sausage_time

Yes you can!  T212 will show you have used your 2026/2027 allowance.

vacheron

himonster said:

Thanks both. So technically I could have £40k in a T212 ISA once April 2026 is here? Is it obvious that the two amounts are separate within the same ISA?

Yes you could... and no it is not obvious from looking at the account balance that the total is from separate years. My T212 cash ISA probably has ISA contributions from the last 18-20 years mixed into it!

This is irrelevant though because all you really care about is how much allowance you have left this year. But it still pays to keep your own records as T212 will only know and reflect how much you have contributed to their ISA in the current tax year.

If, for example, in the 2026-27 tax year you paid £10K into say a Barclays cash ISA and 10K into a T212 cash ISA, both will show that you have 10K allowance available, even though you have actually used up your entire 20K allowance between the two providers. There is no "master" HMRC record that these companies use, it's just their guess based on their internal information (although they don't explain this anywhere which has probably got more than a few people into trouble).

Ayr_Rage

himonster said:

Thanks both. So technically I could have £40k in a T212 ISA once April 2026 is here? Is it obvious that the two amounts are separate within the same ISA?

If it's a cash ISA it will show as one sum and as above, that you have used your annual allowance.

wmb194

himonster said:

Hi, I have a T212 ISA which is maxed out. I'm confused as to what happens in April in terms of having a new ISA allowance.

Am I able to simply add another £20k into the same ISA, or do I have to open another one with someone else? If adding to the existing one, surely that gets confusing if you decide to move money around and how would HMRC know what money is from which ISA year?

Also, from 2027, the limit for ISA's is £12,000. Does this mean I won't be able to transfer a maxed out £20k ISA to a new one with a better rate once the limit is £12,000?

Thanks

The cash Isa limit will be £12k but overall for S&S Isas it will still be £20k. So you could deposit £12k to cash Isas and £8k to S&S Isas.

NebulaNova

wmb194 said:

himonster said:

Hi, I have a T212 ISA which is maxed out. I'm confused as to what happens in April in terms of having a new ISA allowance.

Am I able to simply add another £20k into the same ISA, or do I have to open another one with someone else? If adding to the existing one, surely that gets confusing if you decide to move money around and how would HMRC know what money is from which ISA year?

Also, from 2027, the limit for ISA's is £12,000. Does this mean I won't be able to transfer a maxed out £20k ISA to a new one with a better rate once the limit is £12,000?

Thanks

The cash Isa limit will be £12k but overall for S&S Isas it will still be £20k. So you could deposit £12k to cash Isas and £8k to S&S Isas.

So for example, in 2028 when the new limit is in place, I couldn't transfer a £20k ISA into a better rate one? I'd have to just save £12k in a new one and then leave the £8k in the original ISA?

ColdIron

It's coming into effect 6th April 2027. There are no restrictions in how much you can transfer, only new money

saajan_12

himonster said:

Hi, I have a T212 ISA which is maxed out. I'm confused as to what happens in April in terms of having a new ISA allowance.

Am I able to simply add another £20k into the same ISA, or do I have to open another one with someone else? If adding to the existing one, surely that gets confusing if you decide to move money around and how would HMRC know what money is from which ISA year?

They don't need to know. Once money is in an ISA, it doesn't matter what year it came from or whether its interest. You could have last year's 20k + 1k interest + this year's 20k = 41k in the same ISA. You could then the ISA provider to transfer it to a new ISA without affecting your allowances. 

himonster said:

wmb194 said:

himonster said:

Hi, I have a T212 ISA which is maxed out. I'm confused as to what happens in April in terms of having a new ISA allowance.

Am I able to simply add another £20k into the same ISA, or do I have to open another one with someone else? If adding to the existing one, surely that gets confusing if you decide to move money around and how would HMRC know what money is from which ISA year?

Also, from 2027, the limit for ISA's is £12,000. Does this mean I won't be able to transfer a maxed out £20k ISA to a new one with a better rate once the limit is £12,000?

Thanks

The cash Isa limit will be £12k but overall for S&S Isas it will still be £20k. So you could deposit £12k to cash Isas and £8k to S&S Isas.

So for example, in 2028 when the new limit is in place, I couldn't transfer a £20k ISA into a better rate one? I'd have to just save £12k in a new one and then leave the £8k in the original ISA?

You're still confusing transferring with adding. The limits only apply to adding new money. So in 2028, say you already have 41k in an ISA from past years contributions and interest, but in a low rate account.

- You could transfer that existing 41k into a better rate ISA (don't diy it, you have to fill in a form and the provider transfers it for you). 
- You can also add 12k new money into the better rate ISA (diy)
- You can also add 8k new money into an S&S ISA.