As the deadline for the tax year approaches (5th April), ISA users looking to max out their allowance should make preparations as soon as possible.

In this article, Rob Morgan, Chief Investment Analyst at Charles Stanley—part of Raymond James Wealth Management—offers guidance on using your ISA allowance.

ISAs are one of the simplest ways to invest and save tax. The current tax year ends on 5th April 2026 so anyone considering using this year’s ISA allowance should not delay.

1. Leave your ISA in cash for now if you can’t decide

This tax year (2025/26), you can add up to £20,000 to one ISA or split the money between several of the various types; the most used being Cash ISAs and Stocks & Shares ISAs. Whichever type of ISA you invest in you pay no income or capital gains tax (CGT) on the returns – no matter how much they are.

If you’re unsure where to invest, you can always secure this year’s allowance with cash now and decide later. Generally, there is no charge for holding cash in an ISA. However, take care not to wait in cash too long. Interest on cash in a Stocks & Shares ISA is unlikely to significantly outpace increases in the cost of living, and for the longer term you stand to be better rewarded by investing.

2. Consider managed investments

Choose a multi asset fund that offers a diversified portfolio in one easy-to-buy investment, designed to meet a broad risk profile. This way, your funds are actively managed by a dedicated portfolio management team, which means you do not need to monitor and change individual funds, shares or other assets in your portfolio – it’s done for you.

Some multi-asset funds invest in other funds as well as other assets across a variety of areas. Not having all your eggs in one basket means you are not reliant on specific investments or areas performing well and you benefit from day-to-day portfolio management.

3. Get some ideas to make your own decisions

Investors who wish to select investments themselves can choose from the exceptionally broad range available: thousands of funds, UK and overseas shares, gilts, bonds, investment trusts and ETFs.

With so many possible investments selecting individual ones can be a daunting prospect. To help narrow down the field, look through your provider’s preferred lists, which should highlight what is considered to be good-quality options within their respective areas for new investment.

4. Diversify

If you invest too much in one area you are reliant on its fortunes. Diversification allows you to secure strong long-term returns but without excessive risk and reliance on one or a few areas. It’s the process of dividing your investments between different investments, as well as different asset classes, such as shares, bonds, property, cash and others.

Investors often use funds to provide wide-ranging exposure to a market or asset class. For funds investing in shares, a single active fund typically offers 50 to 80 holdings – ideal for the investor without the time or inclination to select their own. By holding several funds specialising in different areas, you can build a very diversified portfolio quickly and simply.

5. Consider accounts for your family

With inflation taking bites out of spending power and more tax rises ahead, it is more important than ever to ensure your finances are as tax efficient as possible.

If you are married or in a civil partnership, it’s possible to organise your affairs efficiently so that tax-free allowances are maximised. By using two ISA limits a couple can shelter up to £40,000 each year from tax. Transfers between spouses and civil partners are tax free so you can shuffle any money earmarked for investing between you and make the most of the ISA allowances.

You can also consider Junior ISAs for children or grandchildren to help them build tax efficient savings or investments of their own.