ISA Allowance Reset: What to Do Before the Tax Year Ends

Use it or lose it – make the most of your £20,000 tax-free ISA allowance before 5 April 2026

As we approach the end of the 2025/26 tax year, now is the time to take action on one of the most powerful and flexible tax planning tools available in the UK: your ISA allowance.

Whether you’re a high-earning healthcare professional, a business owner planning for the future, or simply looking to grow your wealth efficiently, Individual Savings Accounts (ISAs) remain a cornerstone of smart financial planning — but the window is closing fast.

Here’s what you need to know (and do) before 5 April 2026.

What Is the ISA Allowance?

Each tax year, UK residents can deposit up to £20,000 into ISAs, with all income and gains completely free from income tax and capital gains tax (CGT).

You can split your allowance across different ISA types, including:

• Cash ISA – Typically used for short-term cash requirements.
• Stocks & Shares ISA – Inflation can reduce the future spending power of money. So if you’re putting away money for the longer term e.g. 5+ years, investing in a Stocks and Shares ISA could give you a better chance of growing your money and achieving inflation-beating returns.
• Innovative Finance ISA (IFISA) – An innovative finance ISA lets you use your tax-free ISA allowance while investing in peer-to-peer (P2P) lending. P2P lending is a form of investing where you lend money directly to borrowers and businesses by using an online portal for the exchange of cash. The borrowers then pay back the borrowed amount, with interest on top.
• Lifetime ISA (LISA) – A Lifetime ISA can be opened by people aged 18 to 39 to help towards a first home or retirement (age 60). With a Lifetime ISA, you can invest up to £4,000 per tax year and the government will give you a 25% bonus up to £1,000. Be aware that if using for a first-home, the maximum property price is currently £450,000.
• Junior ISA (JISA) – Parents, family & friends can contribute £9,000 per annum into a Junior ISA for the benefit of a child under the age of 18. Withdrawals cannot be made until the child turns 18 and anything paid into a Junior ISA belongs to the child who has full access once they turn 18.

The ISA allowance resets on 6 April, and any unused portion from this year cannot be carried forward. That’s why this is a critical time to review your options.

Why Act Now?

Use It or Lose It

If you haven’t used your full £20,000 allowance, consider topping up now especially if you have surplus cash, or investments sitting in taxable accounts.

Avoid CGT on Investments

With the Capital Gains Tax allowance now just £3,000 per tax-year shifting taxable investments into an ISA wrapper protects your future gains from tax. Consideration of any unrealised capital gains/losses may be needed.

Invest for Long-Term Growth

The earlier you invest, the more time your money has to compound. Waiting until the last minute – or worse, missing the deadline – means missing a year of potential tax-free growth.

What Should You Do Before 5 April 2026?

1. Review Your Existing ISAs

• Are they still suitable?
• Are you getting the best rates or performance?
• Are your investments still aligned to your preferred risk level?

An independent financial adviser can help consolidate and optimise your ISA portfolio.

2. Top Up to Maximise the Allowance

Even if you can’t deposit the full £20,000 ISA allowance, contributing whatever you can now makes a difference, especially if you’re planning for retirement or future financial freedom.

3. Use a Stocks & Shares ISA for Long-Term Goals

For higher earners or professionals with a longer time horizon, investing through a Stocks & Shares ISA is often the most efficient route to growth – with no tax on income or capital gains.

4. Consider Your Spouse or Partner’s ISA Too

Each individual gets their own £20,000 allowance. That’s £40,000 per couple and £80,000 over just two tax-years if you act before and after the 6 April reset.

5. Avoid Last-Minute Admin

Banks and platforms get busy in the run-up to the deadline. Don’t leave top-ups until the last week – or you may miss out entirely.

Final Thought: This Is an Opportunity, Not a Chore

Tax planning isn’t about ticking boxes. It’s about using every available tool to make your money go further – without giving more than you need to HMRC.

At FTA Financial & Wealth Management, we help professionals like you make the most of every tax year, every allowance, and every opportunity to build wealth with confidence.

Ready to make your ISA work harder?

Book a call with one of our advisers today and we’ll help you wrap up this tax year with clarity and confidence.

This article is for information purposes only and are not a personal recommendation or advice. The value of your investments can go down as well as up and you may get back less than you originally invested. Tax and ISA rules apply and could change in future.