ISA allowance explained

A guide to ISA limits by Furness Building Society

How does the ISA allowance work?

One of the most well-known savings accounts, the Individual Savings Account (ISA) is a popular choice amongst regular savers. In fact, ISAs were designed as a tax-free savings option to encourage people to develop healthier saving habits. Though of course, this generous tax break does come with a limit, which is known as the ISA Allowance. 

Not sure how it affects you? From how much you can save to the number of accounts you can open, our handy guide explains everything you need to know about the ISA allowance and how it works.

Dad carrying children across a field in the springtime.

Why do I pay tax on savings?

Any interest earned on a savings account is considered taxable income, which means we're all eligible to pay this tax.  This means we’re all eligible to pay tax on savings interest. However, the good news is the majority of UK savers are unlikely to ever have to pay it. Statistically speaking, less than 5% of the UK population pay tax on their savings due to the Personal Savings Allowance (PSA) and the ISA Allowance.

What is my ISA allowance?

What is a Personal Savings Allowance?

Is an ISA allowance different from a Personal Savings Allowance?

When should I open an ISA?

Can I have more than one ISA?

Does interest count towards an ISA limit?

What are the different types of ISA?

Does withdrawing money affect my ISA allowance?

What about Junior ISAs?

What happens if you accidentally pay too much into an ISA?

Next Steps

Do you have any questions not covered in this guide? Please get in touch with our team to discuss your savings plans, either by visiting us in branch or calling us on 0800 781 4311.