£12,000 is the annual cash ISA subscription ceiling from 6 April 2027 if you are 64 or under at the end of that tax year. SI 2026/1018 regulation 6 sets that limit within the unchanged £20,000 overall ISA allowance. It was made on 10 September 2026; it is a future-effective rule, not a proposal. You can contribute the year's cash amount at once or over several months. There is no separate £1,000 monthly cap.
What Anna does with £20,000
Anna is 64 on 5 April 2028 and wants to save £20,000 during 2027-28. She can put £12,000 of new money in cash ISAs. The other £8,000 is optional ISA headroom: she can use a non-cash ISA, leave it unused or hold cash outside an ISA. None of those choices is compulsory. If she keeps £8,000 outside at 4.5%, first-year interest is £360. With her full £500 higher-rate Personal Savings Allowance still available, that interest produces no tax that year; if other interest has used her PSA, £360 at the enacted 42% savings higher rate is £151.20. The amount of her other taxable interest changes the result.
The age test and old balances
If Anna is 65 by the end of that tax year, her cash ISA subscription limit is the full £20,000. The boundary is age at tax-year end, not age on 6 April or 66 on that date. Money she already held in cash ISAs before the change keeps its tax-free interest. Formal cash-to-cash transfers still preserve that wrapper. SI 2026/1018 regulation 13 separately restricts transfers from non-cash ISAs into cash ISAs for savers 64 or under at year end.
The other 2027 rule
SI regulation 15 imposes a charge on interest from cash deposits held inside stocks and shares or innovative finance ISAs. The charge uses the savings basic rate, 22% for 2027-28 under Finance Act 2026 section 5. Being 65 or older does not remove this non-cash ISA interest charge. It is charged on interest, not on the £8,000 principal, and no one is required to buy shares to satisfy the cash ISA limit.
