Can you have more than one ISA? And what happens if you do? The short answer is yes, you can hold multiple ISAs—but there are strict rules on how you use them.
Choosing the right mix of ISAs could help you earn better interest, grow your investments tax-free, or even buy your first home faster. But to avoid costly mistakes, it’s important to understand how many ISAs you can have, how much you can contribute, and when having more than one makes sense.
In this guide, we’ll break down the rules, benefits, and common mistakes so you can make the most of your tax-free savings.
How many ISAs can I have?
You can have multiple Cash ISAs, Stocks and Shares ISAs, and Innovative Finance ISAs, as long as you meet the eligibility criteria for each type. However, there are limits on certain ISAs—for example, you can only pay into one Lifetime ISA each year. In addition, a child under 18 can only have one Junior Cash ISA and/or one Junior Stocks and Shares ISA.
As long as you stay within the overall £20,000 ISA allowance, you can contribute to multiple ISAs in the same tax year—except for Lifetime ISAs and Junior ISAs, which are limited to one per tax year.
| Type of ISA | How many can you have? | How many can you pay into per tax year? | Annual contribution limit |
|---|---|---|---|
| Cash ISA | Multiple | Multiple | Combined £20,000 total across all ISAs |
| Stocks and Shares ISA | Multiple | Multiple | Combined £20,000 total across all ISAs |
| Innovative Finance ISA | Multiple | Multiple | Combined £20,000 total across all ISAs |
| Lifetime ISA | Multiple (but only one active at a time) | One | £4,000 (part of the £20,000 total) |
| Junior Cash ISA | One per child | One | £9,000 (separate from the £20,000 adult ISA limit) |
| Junior Stocks and Shares ISA | One per child | One | £9,000 (separate from the £20,000 adult ISA limit) |
Can you put £20,000 into two ISAs?
No, you cannot put £20,000 into two ISAs in the same tax year. The annual ISA allowance is £20,000, and this limit applies across all your ISA accounts combined.
However, you can split your £20,000 allowance between different types of ISAs, such as a Cash ISA, Stocks & Shares ISA, and Innovative Finance ISA. The only exception is a Lifetime ISA, which has a separate limit of £4,000 per tax year within the overall £20,000 allowance.
For example, you could:
- Put £10,000 into a Cash ISA and £10,000 into a Stocks & Shares ISA
- Or put £4,000 into a Lifetime ISA and £16,000 into a Cash ISA
- Or Put £5,000 into an Innovative Finance ISA, £10,000 into a Stocks & Shares ISA, and £5,000 into a Cash ISA
When it makes sense to have more than one ISA
Holding multiple ISAs can be a smart financial move, depending on your goals. Here are some reasons why you might want more than one:
1. Maximising interest rates
Different ISA providers offer varying interest rates, and some ISAs may offer significantly better returns than others. By spreading your savings across multiple Cash ISAs (where permitted) or switching to an ISA with a better interest rate, you can earn more tax-free interest on your savings.
Platforms like Chip offer high-interest savings accounts that make it easier to grow your money while staying within your tax-free allowance. Regularly comparing rates and being open to switching providers can help you maximise the value of your savings over time.
Related: How to Maximise Your ISA Allowance This Tax Year
2. Balancing short-term and long-term goals
If you have different financial goals, holding more than one ISA can help you manage your money more effectively. For example:
- If you want to keep emergency savings easily accessible while also investing for the future, you might use a Cash ISA alongside a Stocks & Shares ISA.
- If your main goal is to save for your first home that you are looking to buy in the next couple of years, you could use a Lifetime ISA and a Cash ISA.
Related: Top 5 Stress-Free Investing Tips for Beginners
3. Diversifying investments
Holding a mix of a Cash ISA, Stocks & Shares ISA, and Innovative Finance ISA can help manage risk while maximising returns. A Cash ISA keeps savings secure and accessible, a Stocks & Shares ISA offers long-term growth potential, and an Innovative Finance ISA provides access to alternative investments like peer-to-peer lending. By using all three, you can balance stability, growth, and higher-risk opportunities within your ISA allowance.
4. Making the most of tax-free savings
The annual ISA allowance resets every 6th April, so some people open a new ISA each year to take advantage of different offers and better rates while keeping previous years’ ISAs growing tax-free.
5. Saving for your child’s future
If you’re saving for your child’s education or future, a Junior ISA allows you to build up tax-free savings for them until they turn 18. You can open both a Junior Cash ISA and a Junior Stocks & Shares ISA for them, depending on your risk preference.
6. Spreading FSCS protection
The Financial Services Compensation Scheme (FSCS) protects up to £85,000 per person, per institution. If you have more than this amount in savings, spreading your money across multiple ISAs with different providers can ensure more of your savings are covered if a bank or provider fails.
Can you transfer money between ISAs?
Yes, you can transfer money between ISAs and different providers, but it must be done properly to keep your savings tax-free. If you simply withdraw from one ISA and deposit into another, it will count as a new contribution, which could cause you to exceed your ISA allowance for the year. Instead, you should request an ISA transfer from your new provider.
How ISA transfers work
- You can transfer money from one ISA to another, even between different ISA types (e.g., from a Cash ISA to a Stocks & Shares ISA).
- You must use your new ISA provider’s transfer service—withdrawing the money yourself and depositing it into another ISA will count as a new contribution, which could mean exceeding your annual ISA limit.
- You can transfer previous tax year savings in full or in part, but funds from the current tax year must be transferred in full.
Related: Should I Transfer My ISA? 8 Key Reasons to Switch
Common ISA mistakes and how to avoid them
ISAs are a great way to grow your savings tax-free, but there are common mistakes that can reduce their benefits or even lead to unexpected tax charges. Here’s what to watch out for and how to avoid costly errors.
1. Exceeding the annual ISA allowance
For the current tax year, the ISA allowance limit is £20,000. If you contribute more than this across all your ISAs, the excess funds won’t be tax-free, and you may have to pay tax on interest or investment gains.
How to avoid it: Keep track of all your ISA contributions, especially if you have accounts with different providers.
2. Withdrawing and reinvesting instead of transferring
If you withdraw money from an ISA and then reinvest it into a new provider, it counts as a new contribution and could lead to exceeding your ISA allowance. It could also mean losing the tax-free status on the withdrawn funds.
How to avoid it: Always use the official ISA transfer service when moving money between accounts to keep the tax-free savings account benefits.
3. Missing out on long-term gains
A Cash ISA is a secure way to save, but interest rates may not always keep up with inflation. Over the long term, keeping all your savings in a Cash ISA could mean missing out on potential investment growth available in a Stocks & Shares ISA. If you don’t need access to your money within the next 3 to 5 years, a Stocks & Shares ISA may offer better long-term growth potential.
How to avoid it: Consider diversifying your savings by splitting your ISA allowance between a Cash ISA and a Stocks & Shares ISA, depending on your risk tolerance and financial goals. Platforms like InvestEngine offer no platform fees, a welcome bonus for new investors, and an ISA transfer bonus, making it a cost-effective option to start investing or move an existing ISA account.
Join InvestEngine and get a welcome bonus of up to £100 .
4. Ignoring ISA transfer rules
Not all ISAs allow transfers, and some current providers may charge an early access charge for moving funds. Additionally, Investment ISA transfers may involve selling assets, which could affect the value of your investments.
How to avoid it: Check your ISA provider’s transfer policy, fees, and whether your new ISA allows transfers before initiating a move.
5. Assuming all ISAs offer the same tax benefits
While ISAs protect your savings from income tax and capital gains tax, different ISAs have different rules. For example, a Lifetime ISA has a government bonus but also an early withdrawal penalty.
How to avoid it: Choose an ISA based on your individual circumstances, long-term financial goals, and whether you need easy access to your money. Consulting a financial adviser can help.
6. Forgetting about past ISAs
Some savers open new accounts each year but forget about old accounts. These accounts may have low interest rates or fees that reduce the value of savings or investments over time.
How to avoid it: Regularly review your ISAs and consider consolidating them with a new provider for a better rate.
7. Overlooking FSCS protection
The Financial Services Compensation Scheme (FSCS) protects up to £85,000 per person, per institution. If you hold more than this amount in one ISA provider, any excess may not be covered if the provider fails.
How to avoid it: Spread large balances across different providers to maximise FSCS protection.
Can I have more than one ISA: Key takeaways
- You can have multiple Cash, Stocks and Shares, and Innovative Finance ISAs.
- You can pay into multiple ISAs in the same tax year, except for Lifetime ISAs and Junior ISAs.
- A child can have one Junior Cash ISA and one Junior Stocks and Shares ISA at the same time but cannot have more than one of each type open simultaneously.
- The total contributions across all your ISAs cannot exceed £20,000 per tax year (except Junior ISAs, which have a separate £9,000 limit per child).
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Capital at risk. The value of your portfolio(s) can go down as well as up and you may get back less than you invest. ETF costs also apply.
This communication is provided for general information only and should not be construed as advice. If in doubt you may wish to consult a professional adviser for guidance.
Tax treatment depends on personal circumstances and is subject to change, and past performance is not a reliable indicator of future return