ISA Calculator

An Individual Savings Account (ISA) is a tax-free wrapper for your savings and investments in the UK. Any interest, dividends or capital gains earned inside an ISA are completely free of UK tax, and you never have to declare them — a simple but powerful advantage that compounds over years and decades.

There are several types. A Cash ISA works like a tax-free savings account, paying interest with no tax to pay. A Stocks and Shares ISA holds investments such as funds and shares, with all growth and dividends tax-free. There's also the Lifetime ISA, aimed at first homes and retirement, which adds a government bonus, and the Innovative Finance ISA for peer-to-peer lending. You can split your allowance across types in the same tax year.

The key limit is the annual ISA allowance — £20,000 per tax year in 2025/26. You can pay in up to that total across your ISAs each year, and the allowance resets every 6 April; it can't be carried forward, so unused allowance is lost. Once money is inside an ISA it stays tax-free year after year, even as your pot grows well beyond the annual limit.

The benefit of the tax-free wrapper grows with time and with your tax position. Outside an ISA, savings interest above the Personal Savings Allowance is taxed at your marginal rate, and investment gains above the annual exemption attract Capital Gains Tax while dividends above the dividend allowance are taxed too. Inside an ISA, none of this applies. For a higher-rate taxpayer investing over many years, sheltering growth from tax can add a substantial amount compared with an ordinary account — which is exactly what this calculator illustrates.

ISAs are also flexible and accessible: you can usually withdraw money when you need it (instantly from most Cash ISAs), and some are 'flexible', letting you replace withdrawn money in the same tax year without using more allowance. For long-term goals, a Stocks and Shares ISA gives investments room to grow tax-free, while a Cash ISA suits shorter horizons or money you can't risk.

This calculator projects your ISA growth and shows the tax-free advantage versus a taxed account. Real returns vary, especially for investments, so treat projections as estimates, and remember the allowance and rules can change between tax years.