Cash ISA limits have been the subject of intense scrutiny over the past few months, as speculation ramped up that Chancellor Rachel Reeves may have been ready to take the axe to the current £20,000 limits. Mercifully, the government has not yet announced any cuts to Cash ISA limits, which means that the standard limit for a Cash ISA remains at £20,000 for the tax year running from April 6 2025 to April 5, 2026.
However, there is a way you can actually put more than £20,000 into a Cash ISA in a single year, depending on the type of ISA you have. Withdrawing money from a Cash ISA is generally not advised. You’ve put that money in there to keep it protected from tax and to save it for the long term. But sometimes, in an emergency, you might need to crack into your nest egg temporarily and plan to replace it later.
With some types of Cash ISAs, known as a flexible Cash ISA, you can do exactly that, and then you’re able to put the money back into the ISA within the same tax year, with your annual allowance increased by the same amount you withdrew, pushing the total deposits you can make in a single tax year above £20,000.
Gov.uk explains it: “If your ISA is ‘flexible’, you can take out cash then put it back in during the same tax year without reducing your current year’s allowance. Your provider can tell you if your ISA is flexible.
“Your allowance is £20,000 and you put £10,000 into an ISA during the 2025 to 2026 tax year. You then take out £3,000.
“The amount you can now put in during the same tax year is £13,000 if your ISA is flexible (the remaining allowance of £10,000 plus the £3,000 you took out.”
In this example, your annual allowance for the year would become £23,000, because you can replace money you withdrew as long as it’s within the same tax year. This can be useful if you have a sudden emergency but you know you can put the cash back in later, before the tax year ends.
But you need to check to make sure you know the rules on your Cash ISA, because non-flexible ISAs will not let you do this and may even slap you with a penalty.
With a non-flexible ISA, you could only deposit another £10,000, so your final ISA amount would have £17,000 in, losing the £3,000 you took out from your total allowance and making it subject to tax on the interest.
