Martin Lewis urged savers in the UK to (Image: Getty)
Martin Lewis has issued a £20,000 reminder as he told savers to “use it or lose it”. The expert was referring to your ISA allowance, with the end of the 2026 financial year fast approaching.
An Individual Savings Account (ISA) allows people to save money and earn interest that is tax-free. However, there is a yearly limit on how much you can have in an ISA.
Currently, this limit is £20,000 for the year 2025/26 with the new financial year starting in April. Although the limit is set to remain the same for the following year, you have until April 5 to make the most of this year’s saving allowances.
In an update on his Money Saving Expert (MSE) website, Martin explained that the interest rates on ISAs are some of the best you can get.
He said: “Your money’s nicer in an ISA, and now it’s use it or lose it time! Top cash ISAs pay 4.68%, beating normal savings, though long-term shares ISAs are likely the winner”
An Individual Savings Account (ISA) allows people to save money and earn interest that is tax-free (Image: Getty)
He continued: “The tax year, and thus the ISA year, ends on 5 April. Though it’s best not to leave it to the last minute as some providers shut their (virtual) doors early.
“If you don’t use this year’s allowance, you lose it. The good news, though, is providers, as normal, are ramping up deals this time of year while the focus is on ISAs.”
Every tax year, each adult in the UK gets a £20,000 ISA allowance to put money away tax-free in a cash ISA, or a shares (investment) ISA. “You can have all £20,000 in one, or split it across both types,” Martin said.
To explain how ISAs work compared to other savings account, Martin used an analogy of a cake. He said:”Picture a cake, let’s say a chocolate cake for cash savings (though it could equally be a strawberry cake for shares).
“Normally it’s just sitting there, so the tax collector can come and take a bite.
Read more: Martin Lewis issues urgent message to Lloyds Bank and Halifax customers
Read more: Martin Lewis says people with these conditions can cut council tax bill to £0
“But think of an ISA wrapper like a protective piece of clingfilm you can wrap around some of the cake. Once your cash is inside, nothing changes – the cash in savings is still cash in savings (so a cash ISA is just a savings account) and the shares are still shares (so a shares ISA is just an investment account). The only difference is… now the tax collector can’t eat any.”
According to Martin, the key need-to-knows about ISAs are:
- You can’t carry over your ISA allowance, so 5 April is the last date you can fill this year’s ISA. After that, it closes
- You get a new ISA allowance on 6 April. To explain, if you haven’t used your ISA this tax year, and have enough money, you could put £20,000 in now, and another £20,000 in on 6 April (using next tax year’s allowance). Even if you don’t have enough to use next year’s, if it’s right for you, get the money in now, in case you have more to put away next year
- Once money’s in an ISA it stays tax-free year after year. The limit is on how much new money you can put in within each tax year. There’s no total limit on what you can have in ISAs. Some now have £100,000s in cash ISAs, having used many years’ allowances, and there are some shares ISA millionaires
Changes for 2027
From April 6, 2027, the annual Cash ISA limit for people under 65 will be reduced to £12,000 as part of a new two-tier system designed to encourage investing.
Although the total ISA allowance is set to remain at £20,000, the remaining £8,000 must be placed in Stocks and Shares or Innovative Finance ISAs.
