UK ISA Allowance & Returns Calculator
Calculate how your ISA savings grow over time, compare Cash vs Stocks and Shares ISA returns, and optimise your annual £20,000 tax-free allowance.
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ISA Guide 2026/27
What do I need to know about ISA Types and Allowances 2026/27?
Annual ISA allowance: £20,000 per person per tax year (unchanged since 2017/18). Types: Cash ISA — deposit account, FSCS protected, currently 4.5-5.0% AER for best buys. Stocks and Shares ISA — invest in funds, shares, investment trusts, ETFs. Junior ISA — £9,000 allowance per child per year. Lifetime ISA — up to £4,000/year with 25% government bonus (max £1,000/year bonus), for first home purchase or retirement (from age 60). Help to Buy ISA (closed to new applicants 2019). All ISA income and growth is entirely tax-free, regardless of which type or combination of ISAs you hold.
What's the difference between Cash ISA and Stocks and Shares ISA?
Cash ISA: protected up to FSCS limits to capital, returns currently 4.5-5.0% AER (best buy easy access 2024). Returns taxable outside ISA wrapper. Stocks and Shares ISA: historical long-term average returns approximately 7-10% per year (for a globally diversified index fund). Volatile in the short term — falls of 30-50% can occur. For money needed within 5 years: Cash ISA (capital security matters). For money not needed for 5+ years: Stocks and Shares ISA typically produces significantly higher
What's the key thing to understand about The Lifetime ISA (LISA)?
LISA key rules: must open between ages 18-39. Contribute up to £4,000/year. Government adds 25% bonus (up to £1,000/year). Use for: first home purchase (property up to £450,000) or retirement (access from age 60). Penalty for other withdrawals: 25% charge on the whole withdrawal, which recovers the bonus and a portion of your own contributions (effectively a 6.25% exit penalty on your own money). For first-time buyers: the LISA beats the Help to Save for property up to £450,000 because the 25% bonus effectively boosts every pound saved by a quarter, on top of whatever investment growth the account achieves.
What should I know about Maximising Your ISA?
Key strategies: use your full allowance each year if possible — unused allowance cannot be carried forward. Use the full £20,000 at the start of the tax year (6 April) to maximise the full year's growth. Couple: £40,000/year combined allowance — maximise both. Children: £9,000/year Junior ISA — investing from birth is powerful. HMRC's new rules (effective 2024): multiple Cash ISAs are now permitted in the same tax year (previously only one of each type per year). Transfers: you can transfer between ISA providers or between ISA types without it counting against your annual allowance, as long as it's a proper ISA-to-ISA transfer rather than withdrawing and re-depositing the cash yourself.