ISA Calculator — Grow Your Money, Tax-Free, Forever

Everyone knows ISAs are "tax-free," but that phrase doesn't really land until you see the actual number it's saving you. This ISA calculator runs your savings or investment growth two ways side by side: once inside the ISA wrapper, where it's genuinely tax-free forever, and once as if the same money had grown in a normal account, subject to the Personal Savings Allowance, dividend allowance, or Capital Gains Tax depending on the ISA type you're modelling.

The gap between those two numbers is the real, tangible reason ISAs matter — not just as an abstract tax-efficiency principle, but as an actual pound figure that grows larger the more you save and the longer you leave it.

For the 2026/27 tax year, every UK adult gets a personal ISA allowance of £20,000 — the total you can pay in across all your ISAs combined, in any split you choose. Married couples and civil partners each get their own separate £20,000 allowance, meaning a couple can shelter up to £40,000 a year between them.

You could put the full £20,000 into a single Stocks and Shares ISA. Or split it — say £15,000 into a Cash ISA and £5,000 into a Stocks and Shares ISA. Since April 2024, you can also pay into more than one ISA of the same type in a single tax year, provided you stay within the £20,000 overall limit. The allowance resets every 6 April, and unused allowance doesn't carry forward — it's genuinely a use-it-or-lose-it limit each year.

This is worth knowing well ahead of time, since it changes the maths on where new savings should go. From 6 April 2027, the Cash ISA allowance specifically reduces from £20,000 to £12,000 for savers under 65 — announced at the Autumn Budget 2025. The overall ISA allowance stays at £20,000, so the remaining £8,000 would need to go into a Stocks and Shares ISA, Innovative Finance ISA, or another eligible ISA type instead of cash.

If you're 65 or over, this change doesn't affect you at all — you keep the full £20,000 Cash ISA allowance regardless. And crucially, this only applies to new contributions from that date — any Cash ISA balance you've already built up doesn't need to be moved or restructured.

Until then, for the current 2026/27 tax year, the full £20,000 Cash ISA allowance remains available to everyone — genuinely the last full tax year this applies to under-65s, worth being aware of if cash saving is your priority.

These are two separate tax-free mechanisms that work alongside each other, and understanding the difference helps you decide whether an ISA is genuinely adding value for your specific situation. The Personal Savings Allowance (PSA) lets you earn savings interest tax-free outside an ISA — up to £1,000 for basic-rate taxpayers, £500 for higher-rate, and £0 for additional-rate. Interest earned inside an ISA doesn't count toward this allowance at all — it's on top.

For most people with modest savings, the PSA alone comfortably covers their interest without needing an ISA specifically for tax reasons. But as balances or interest rates rise, more savers find their PSA simply isn't enough — which is exactly when a Cash ISA becomes genuinely valuable, since it removes the ceiling entirely. Our savings rate guide covers this threshold calculation in more depth.

Many, though not all, ISA providers offer "flexible" ISAs, which allow you to withdraw money and pay it back in during the same tax year without it counting against your allowance twice. Withdraw £5,000 from a flexible Cash ISA in June, replace it in November, and you haven't used £25,000 of allowance — you've used £20,000, because the replacement isn't treated as new money.

This genuinely matters if you're using an ISA as part of an emergency fund, since a non-flexible ISA would treat any withdrawn-then-replaced money as using fresh allowance, potentially locking you out of maxing your contribution for the year. Always check specifically whether your provider's ISA is flexible before assuming this feature applies.

You start with £5,000 in a Cash ISA, add £300 a month, and the account pays 4.5% AER. Over 15 years, you'll have paid in £59,000 of your own money, and the ISA grows to roughly £68,400 — around £9,400 of tax-free growth.

As a higher-rate taxpayer, if that same growth had happened in a normal savings account, only your first £500 of interest each year would have been tax-free under the PSA — everything above that taxed at 40%. Over the full 15 years, that adds up to roughly £1,880 in tax you simply never pay, purely because the money sat inside an ISA wrapper instead.

Now picture the same numbers in a Stocks and Shares ISA instead — running this same stocks and shares ISA calculator mode, assuming a long-run average return closer to 6.5%. The same contributions grow to roughly £84,000 over 15 years — and because Capital Gains Tax and dividend tax would otherwise have applied to a meaningful share of that £25,000 of growth outside an ISA, the tax saving is considerably larger still for a higher-rate taxpayer investing over the long term.

Official sources & further reading: check current ISA rules at GOV.UK, read general savings guidance at MoneyHelper, and verify any provider on the FCA register. Compare where else your savings could grow with our savings interest calculator, or browse every tool on the mortgage calculators homepage.