The Chancellor’s Spring Statement 2025 has confirmed that the annual limit for Cash ISAs will remain unchanged, allowing UK households to save up to £40,000 tax-free between now and April 2026. According to Express.co.uk, rumours of a drastic cut to ISA allowances have been put on hold, giving savers a unique opportunity to boost their savings before any future changes are introduced.
No Immediate Cuts to the £20,000 Allowance
For months, speculation circulated that Chancellor Rachel Reeves would reduce the current annual ISA allowance from £20,000 to as low as £4,000. However, the Spring Budget announcement confirms that no change will be made during the 2025–26 tax year. Savers still have the opportunity to deposit £20,000 before 5 April 2025, and a further £20,000 from 6 April 2025 to 5 April 2026, while the rules remain in place.
The delay in any policy shift has prompted financial commentators to advise swift action. This window offers a rare chance to shelter a substantial sum from taxation, regardless of what reforms may come in Autumn 2025 or beyond.
Martin Lewis Explains How to Maximise the Window
Money expert Martin Lewis has highlighted that this scenario gives savers the opportunity to put away up to £44,000 tax-free by April 2026—even if a cut is introduced next year.
Speaking on The Martin Lewis Money Show Live, he explained:
“What it would mean is, you could put £20,000 in this year, you could put £20,000 in next year if she doesn’t drop it on April 6 [which she hasn’t] and now you’ve got £40,000. But maybe the year after, I can only put £4,000 in. So I’ve only got £44,000 protected. Wouldn’t take money out of those! They’re still protected.”
This guidance emphasises the importance of acting within the current framework before more restrictive measures are potentially introduced.
Uncertainty Still Looms Over Long-Term ISA Rules
While the Chancellor has refrained from cutting the allowance for now, the possibility of future changes remains open. Treasury Minister Emma Reynolds declined to guarantee the current allowance beyond 2026, telling MPs the government remains committed to both promoting savings and building a broader investment culture.
“Cash savings provide a vital source of savings for a rainy day, we recognise that,” Reynolds said.
“But equally, we want to build a better investment culture in our society so that it’s not just the 8% of people who can afford financial advice who can have the opportunity of better rewards by investing in British companies and others in our economy.”
This indicates a policy direction aimed at encouraging more households to consider stocks and shares ISAs or other forms of long-term investment, rather than simply relying on cash-based accounts.
What Savers Should Do Now
With the current £20,000 annual Cash ISA limit confirmed for 2025–26, individuals who have the financial flexibility are encouraged to act soon. By depositing before the 5 April 2025 deadline, savers can then use their fresh allowance from 6 April 2025 onward, effectively doubling their tax-free savings within a short period.
Advisers warn that waiting for future budgets could result in missed opportunities if allowance cuts are implemented later in the year. Taking advantage of the current structure is considered a prudent step for those looking to preserve the tax benefits currently available.
