ISA Calculator

An Individual Savings Account (ISA) is the UK’s primary tax-free wrapper for cash savings and investments. The 2025/26 ISA allowance is £20,000 per adult per tax year, refreshed every 6 April, and can be split across four ISA types: Cash ISA, Stocks and Shares ISA, Innovative Finance ISA (peer-to-peer lending) and Lifetime ISA. The Lifetime ISA has its own £4,000 sub-cap inside the £20,000 main allowance. Crucially, from April 2024 you can pay into multiple ISAs of the same type in the same tax year — a long-standing restriction finally lifted by the Spring Budget 2024 — making provider hopping for the best rate vastly easier. Everything inside an ISA is exempt from UK income tax on interest, dividend tax on equity income, and Capital Gains Tax on disposals. There is no need to declare ISA growth on your Self Assessment. Over a 25-year working life, sheltering £20,000/year (where affordable) creates a wrapper worth potentially £1-2 million depending on returns — entirely free of UK tax. For higher-rate and additional-rate taxpayers, where the Personal Savings Allowance is £500 or £0, the ISA wrapper is essentially priceless on any interest-bearing balance over a few thousand pounds. This calculator handles Cash ISA projections (using current AER rates of 4-5% in 2025), Stocks and Shares ISA projections (using your chosen real return assumption — historic UK equity return is about 5% real), and combined Lifetime ISA scenarios with the 25% government bonus. It models multi-year contributions up to the £20,000 cap each year, applies the contribution rules, and compares ISA growth against an equivalent taxable account at your marginal rate. Key rules. You must be a UK tax resident, aged 18 or over for adult ISAs (16 for Cash ISA, 18-39 to open a LISA). You cannot pay into an ISA in someone else’s name except via a Junior ISA (£9,000/year cap, opened by parent/guardian for under-18s). ISAs do not survive death without using the Additional Permitted Subscription (APS) — a surviving spouse can inherit the deceased’s ISA allowance via APS. Funds remain tax-free within the wrapper if not withdrawn. The calculator does not handle flexible ISAs (where withdrawals replenish the allowance within the same tax year), bed-and-ISA transactions to crystallise gains, or the British ISA proposal which has been deferred. For LISA-specific modelling use the Lifetime ISA Calculator; for pure compound projections use the Compound Interest Calculator.