What is the Cash ISA limit?
Every tax year you can save money in to one of each kind of Individual Savings Account (ISA). You can currently save a total of £20,000 in ISAs every tax year – this is known as the ISA savings limit. The tax year for 2023/24 runs from 6 April 2023 to 5 April 2024.
There are four different types of ISA:
- Cash ISA
- Stocks and shares ISA
- Innovative finance ISA
- Lifetime ISA
You can split the allowance across different types of ISA each tax year or save it all in one place. You can only pay £4,000 into a Lifetime ISA each tax year.
So for example, you could save £12,000 in a Sainsbury’s Bank Fixed Rate Cash ISA, £4,000 in a Lifetime ISA, £2,000 in a Stocks and Shares ISA and £2,000 in an Innovative Finance ISA.
Alternatively, you could save £5,000 in a Sainsbury’s Bank Variable Rate Cash ISA, £5,000 in a Stocks and Shares ISA and £10,000 in an Innovative Finance ISA.
But, you wouldn’t be able to save money in both a Variable Rate Cash ISA and a Fixed Rate Cash ISA in the same tax year, as these are both types of Cash ISA.
What are the Cash ISA limit rules?
These are the Cash ISA rules:
- You can only have one active Cash ISA every year
- You can’t open multiple Cash ISAs in a single tax year
- You can put a total of £20,000 into Cash ISAs each tax year
Different types of Cash ISAs give you different ways to access your money. At Sainsbury’s Bank we offer fixed rate and variable rate Cash ISAs.
- Fixed Rate Cash ISAs set the interest for an agreed period of time when you open the account. You will not be able to access to the funds until the term ends. If you need to access it before the end of the term you can face an early closure charge.
- Variable Rate Cash ISAs offer variable interest rates and allow you to access your money at anytime. You can transfer money from your ISA into a current account, but it will lose its tax-free status.
Frequently asked questions
How many ISAs can you have?
There is no limit on the number of ISAs you can have, but you can only deposit money into one of each type of ISA every tax year. The four different types of ISA are:
- Cash ISA
- Stocks and Shares ISA
- Innovative Finance ISA
- Lifetime ISA
When can you open a cash ISA?
You can open a new cash ISA every tax year to make the most of tax-free savings. You can deposit up to £20,000 in ISAs each tax year. You can open an ISA at any time during the tax year.
What happens to a cash ISA after one year?
Your ISA will not close at the end of the tax year. You can continue to use the same cash ISA for multiple tax years if you choose. The savings already deposited will keep their tax-free status. However, you may be able to find a better Annual Equivalent Rate (AER) by opening a new cash ISA each tax year. You can transfer your ISA savings to a new provider using an ISA transfer form.