How Many ISAs Can I Have?

When it comes to saving money effectively, it’s important to understand the rules around saving.

However, in the UK, ISA rules change regularly, leading to some confusion about how many savings accounts can be opened and how much money can be saved.

In this article, we will explore common questions about ISA limits, empowering our members to make the best savings choices for themselves.

Understanding ISA Limits: A Brief Guide

One of the most common misconceptions about ISAs is how many ISAs can be opened in a single tax year.

Four primary types of ISAs can be opened:

• Stocks and shares ISAs
• Cash ISAs
• Innovative finance ISAs
• Lifetime ISAs

Before the 2024/25 tax year, savers were limited to opening one of each ISA type per year.

However, in the 2023 Autumn Budget, the Government announced that, in some cases, savers would be able to open more than one ISA of the same type per year.

Below, we will break down the limits that apply to different types of ISA.

Can You Have More Than One Stocks And Shares ISA?

Stocks and shares ISAs are a popular choice for UK savers looking to help their money grow.

When money is saved in a stocks and shares ISA, it is invested in a range of businesses and enterprises rather than held in cash, in the hope that the value of those investments will increase at a higher rate than interest rates.

Following the Government’s 2023 Autumn Budget, savers can open multiple stocks and shares ISAs in one tax year, as long as their overall contribution to all of their ISAs remains below the £20,000 limit.

How Many Cash ISAs Can I Have?

Unlike stocks and shares ISAs, money in a cash ISA is held as cash, earning interest on the amount saved.

This means that cash ISAs are more stable than stocks and shares ISAs, as they are less vulnerable to economic shifts and market changes, but their earning potential is limited to the agreed rate of interest.

Like stocks and shares ISAs, the ability to open cash ISAs was also expanded in the 2024/25 tax year. This means that savers can open multiple cash ISAs per tax year, as long as their contributions across all ISAs remain below £20,000.

However, the Government has recently announced a change to cash ISAs that is important to bear in mind: from the 2027/28 tax year, savers under 65 will be able to save only £12,000 in a cash ISA, instead of the full £20,000 limit.

This means that, if you have an ISA strategy that relies heavily on making the maximum contribution to your cash ISA, this represents an opportunity to reconsider your savings strategy.

How Many Innovative Finance ISAs Can I Have?

Innovative finance ISAs are slightly different from traditional cash or stocks and shares ISAs.

Rather than being held in cash or invested in stocks and shares, innovative finance ISAs invest in ‘innovative’ financial products, including peer-to-peer lending (where some of the value may be lent to businesses or individuals at an agreed rate of interest).

Like with other ISAs, savers can open as many innovative finance ISAs as they need, as long as they do not invest more than the annual £20,000 limit.

However, there are additional considerations when choosing an innovative finance ISA: although returns can be higher than those from traditional cash or stocks and shares ISAs, the peer-to-peer format carries a higher risk of investors losing money due to defaulted loans or bad debt. In addition to this risk, innovative ISA products are not protected by the FSCS, leaving investors with fewer protections than those offered by other types of ISA.

How Many Lifetime ISAs Can I Have?

Lifetime ISAs are a slightly different product from the other ISAs listed; you will receive a guaranteed 25% uplift from the government every tax year, and can earn interest in addition to the government contribution.

Because the government provides this increase, there are restrictions on both contributions and how the lifetime ISA can be used.

Unlike other types of ISA, a lifetime ISA has an annual contribution limit of £4,000. This means that the maximum the government can increase the value of the ISA by is £1,000 per tax year, assuming a saver contributes the full amount possible.

In addition, there are rules surrounding how a lifetime ISA can be used. A lifetime ISA can be used either to purchase a property (as long as you are a first-time buyer) or fund retirement (with savers gaining access to the money after the age of 60). Withdrawals for any other reason will incur an automatic penalty of 25% of the value withdrawn, preventing savers from adding money, gaining the benefit and then immediately withdrawing.

The rules around how many lifetime ISAs a saver can open are slightly different. Savers can only contribute to one Lifetime ISA per year. This means that, in practice, if a saver wanted to open multiple lifetime ISAs, they would need to open a new lifetime ISA every tax year, as a contribution is required to open an account.

Discover The Right ISA For You At Sheffield Mutual

At Sheffield Mutual, our ISA products have been designed to give our members options for managing their savings strategy, with the option to smooth funds to deliver more stable, medium to long-term investment returns. 

Smoothed funds offer several benefits, including:

• Protection: Shields your savings from sudden stock market volatility. 
• Price Averaging: Based on your underlying investment over a set period, cushioning any drops in the market. 
• Estimated Growth Rates: Adjusted based on long-term growth expectations rather than day-to-day asset value. 
• Less Stress: Protection from market spikes and crashes means investors have less to worry about. 

In some cases, MVR (Market Value Reduction) may apply for those not withdrawing money during adverse market conditions. An MVR helps by: 

• Ensuring that members receive a fair share of any with-profits fund.

• Reducing the amount of payout you receive when withdrawing during exceptional circumstances.

You will only notice the effect of an MVR when withdrawing at a time when one is in place; it can be added, removed, increased, or decreased at any time. For more information, browse our article on What is a Market Value Reduction?

We’ll help you find the ideal ISA for your needs. 

Whether you are looking to save regularly with a Regular Premium Investment ISA or looking to make lump sum investments with our Single Premium Investment ISA, our products are designed with our members in mind.

Alternatively, if you are looking for an ISA with strong ESG credentials, our Single Premium Sustainable Investment ISA and Regular Premium Sustainable ISA have been designed to help our customers avoid investing in potentially harmful industries.

It is important to note that all ISAs offered by Sheffield Mutual are stocks and shares ISAs. In addition, because our products are classified as insurance products, all of our ISAs are 100% covered by the FSCS, ensuring that our customers are always protected.

Browse our range of ISAs and other savings products to help you build the ideal savings plan. If you aren’t sure which products are right for you, consider using our product selector or contact us with any questions.

This article provides generic information and the writer's opinions and should not be relied upon for investment decisions. Sheffield Mutual has provided no advice. If you doubt whether a savings or investment plan suits you, consider contacting a financial adviser for advice. If you do not have a financial adviser, you can get details of local financial advisers by visiting www.unbiased.co.uk or www.vouchedfor.co.uk. Advisers may charge for providing such advice and should confirm any costs beforehand.