Lloyds Banking Group has forecast that the total value of UK Individual Savings Accounts (ISAs) will surpass the £1 trillion mark by the end of the current tax year, marking a major milestone for British savers seeking tax-efficient growth. According to analysis by the bank, which draws on official figures from HM Revenue and Customs and the Bank of England, households are on track to pour a record £115 billion into ISAs during the 2025/26 tax year.
Of that sum, more than £85 billion is expected to flow into cash versions alone, with net cash contributions projected to climb by 20 per cent compared with recent periods.
The surge reflects a combination of sustained interest rates and growing awareness that the annual cash ISA limit will drop to £12,000 from 2027. Between the 2021/22 and 2023/24 tax years, total ISA deposits jumped more than 50 per cent—from £66.9 billion to £103 billion—almost entirely thanks to cash products.
During that time, cash ISA inflows doubled from £30.9 billion to £69.5 billion, while stocks-and-shares contributions dipped slightly.
Lloyds estimates net cash ISA savings will reach around £55 billion this year, lifting the overall stock of cash ISAs above £450 billion.
Meanwhile, stocks-and-shares ISAs, which stood at £511 billion in value at the end of the previous tax year (versus £360 billion for cash), are set to exceed £600 billion once fresh contributions and modest market gains are factored in.
That would push the combined ISA universe comfortably past the trillion-pound threshold.
Subscription numbers are also rebounding.
From a low of 10.1 million accounts in 2017/18, the total is expected to reach 17.9 million this tax year—including up to 12.5 million cash ISAs—up from roughly 15 million in 2023/24.
Average balances have grown steadily too: cash ISA holdings have risen from just £2,483 per account in 2008/09 to more than £6,900 recently and are forecast to top £9,500 this year.
Simon Caddick, Savings Director at Lloyds, noted that customers are actively maximising their £20,000 annual allowance while they can.
“Savers are always looking for simplicity and ways to maximise their savings,” he said.
“ISAs are clearly at the front of many people’s minds when thinking about saving, but many aren’t using their allowance. Their tax-free status is a compelling reason ISAs should be part of every saver’s plan for their future.”
Choosing the right ISA remains key.
Cash ISAs continue to dominate for their straightforward interest, easy access and capital protection, with fixed-rate options offering higher returns for those who can lock money away.
Stocks-and-shares ISAs suit those comfortable with market risk, allowing tax-free growth on a broad range of investments—provided savers take a five-year or longer view to ride out volatility.
Lloyds also highlighted Junior ISAs, which let parents contribute up to £9,000 per child annually on top of their own £20,000 limit, helping build long-term financial habits.
With the deadline for this year’s contributions fast approaching, professionals at Lloyds urge savers to review their options now.
Whether prioritising safety or growth, the tax advantages remain a powerful incentive as the UK savings landscape evolves. The projected trillion-pound milestone underscores how central ISAs have become to household finances—and how quickly that landscape is shifting.
