Stocks & Shares ISA Calculator UK
Use our Stocks and Shares ISA calculator to project how your investments could grow, completely free from UK tax. Enter your annual investment, expected annual growth rate, and the number of years to see your projected portfolio value and the tax you save compared to a general investment account.
Stocks & Shares ISA Growth Calculator
Your Stocks & Shares ISA Projection
| Year | Invested | Portfolio Value | Total Growth |
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What Is a Stocks and Shares ISA?
A Stocks and Shares ISA is a tax-free investment wrapper. Any investments held inside it are sheltered from UK tax - you pay no Capital Gains Tax (CGT) on profits, no Income Tax on dividends, and no tax on interest. You can invest up to £20,000 per tax year across all your ISAs combined.
Inside a Stocks and Shares ISA, you can invest in a wide range of assets: shares, investment funds, ETFs, investment trusts, bonds, and more. The choice of platform and investments is yours. Most long-term investors choose low-cost global index funds as their core holding.
ISA Allowance 2025-26
The annual ISA allowance is £20,000 per person per tax year. This has been unchanged since 2017-18. The allowance runs from 6 April to 5 April. Key rules:
- You can split the £20,000 across multiple ISA types in the same year
- You can only pay into one Stocks and Shares ISA per tax year
- Unused allowance cannot be carried forward to the next year
- The allowance is per person - couples can shelter £40,000/year together
Historical Stock Market Returns
Conservative (5%)
20 years = £347k
Cautious assumption
Moderate (7%)
20 years = £437k
FTSE 100 + dividends
Optimistic (10%)
20 years = £630k
Global tech-heavy index
The FTSE 100 total return (including dividends reinvested) has averaged approximately 7-8% per year over the long term. The MSCI World index, which includes global developed market equities, has averaged closer to 8-10% per year. Remember these are pre-charge averages and include significant periods of decline.
Tax Benefits in Detail
The tax advantages of a Stocks and Shares ISA are substantial, particularly over long time periods:
- Capital Gains Tax: Outside an ISA, gains above the CGT annual allowance (£3,000 in 2025-26) are taxed at 18% (basic rate) or 24% (higher rate) for investments. Inside an ISA, all gains are tax-free.
- Dividend tax: Outside an ISA, dividends above the £500 dividend allowance are taxed at 8.75% (basic), 33.75% (higher), or 39.35% (additional). Inside an ISA, all dividends are received tax-free.
- No reporting: You do not need to report ISA gains on a Self Assessment tax return, simplifying your tax affairs.
Best Stocks and Shares ISA Platforms UK 2025
| Platform | Annual Fee | Fund Charge Range | Best For |
|---|---|---|---|
| Vanguard | 0.15% (max £375) | 0.06% - 0.22% | Low-cost index funds |
| Trading 212 | 0% (free) | Fund dependent | Zero platform fee |
| Hargreaves Lansdown | 0.25 - 0.45% | 0.06% - 1.5% | Wide investment choice |
| AJ Bell | 0.25% (max £3.50/mo shares) | Varies | Shares and funds |
| InvestEngine | 0% (free) | ETF charges only | ETF-only portfolios |
| Nutmeg | 0.25 - 0.75% | Fund charges extra | Managed portfolios |
Investment Options Within a Stocks and Shares ISA
The range of investments available inside a Stocks and Shares ISA is broad:
- Index funds (trackers): Passively follow an index like the FTSE All-Share or MSCI World. Very low charges (0.06-0.22%). Recommended for most investors.
- ETFs (Exchange-Traded Funds): Similar to index funds but traded on stock exchanges throughout the day. Very tax-efficient and low-cost.
- Individual shares: Buy shares in specific companies (UK or overseas). Higher risk due to concentration, but potentially higher rewards.
- Investment trusts: Listed companies that invest in other assets. Often available at a discount to their net asset value.
- Bonds and gilts: Lower risk than shares. UK government gilts and corporate bonds can be held within an ISA.
Stocks and Shares ISA vs Pension
Both ISAs and pensions offer tax advantages for long-term investing, but they work differently:
- Pension: Contributions attract upfront tax relief (20-45% depending on your tax rate). Money is locked until age 57+ (rising to 58 from 2028). At retirement, 25% can be taken tax-free; the rest is taxed as income.
- ISA: No upfront tax relief on contributions. Complete flexibility to withdraw at any time with no tax. All growth is tax-free.
For most people, contributing to a workplace pension (especially with employer matching) should come first. Once this is maximised, a Stocks and Shares ISA is an excellent second choice for flexible tax-free investing.
Lifetime ISA for First Home or Retirement
The Lifetime ISA (LISA) is a special ISA type for those aged 18-39. You can save up to £4,000 per year and receive a 25% government bonus (up to £1,000/year). The money can only be used to buy a first home (up to £450,000) or from age 60 onwards.
Withdrawals for other purposes incur a 25% penalty (which effectively claws back the bonus plus some of your own money). See our Lifetime ISA calculator for projections.
How Stocks & Shares ISA Calculator Works
This calculator applies the latest 2025/26 HMRC tax rates to estimate your tax position. The UK uses a progressive tax system where different portions of your income are taxed at different rates. Only income above the tax-free personal allowance is subject to tax, and each band applies only to the slice of income within that range.
Understanding your tax liability helps you make informed decisions about pension contributions, salary sacrifice, gift aid donations, and other tax-efficient strategies. This tool provides an estimate based on standard tax codes, though your actual position may differ if you have multiple income sources or special circumstances.
Key Information for 2025/26
The personal allowance is £12,570 (frozen until 2028). Basic rate: 20% on income from £12,571 to £50,270. Higher rate: 40% on income from £50,271 to £125,140. Additional rate: 45% on income above £125,140. The personal allowance reduces by £1 for every £2 earned above £100,000, creating an effective 60% rate between £100,000 and £125,140.
Example Calculation
On £42,000 annual income: £12,570 is tax-free, then £29,430 is taxed at 20% = £5,886 income tax. National Insurance adds £2,354 at 8% on earnings above £12,570. Total deductions: £8,240, leaving take-home pay of £33,760 per year or £2,813 per month.
Source: Based on official HMRC 2025/26 tax rates. Last updated March 2026.
Frequently Asked Questions
What is the Stocks and Shares ISA allowance for 2025-26?
The annual ISA allowance is £20,000 per tax year (2025-26). This can be split between different ISA types - Cash ISA, Stocks and Shares ISA, Innovative Finance ISA, and Lifetime ISA (limited to £4,000) - in any combination, as long as the total does not exceed £20,000.
What are the tax benefits of a Stocks and Shares ISA?
Inside a Stocks and Shares ISA, all growth, dividends, and interest are completely free from UK tax. There is no Capital Gains Tax (CGT) on profits, no Income Tax on dividends or interest, and no tax reporting required. This is a significant advantage over a general investment account where CGT rates are 18-24% on gains above the annual allowance.
What can I invest in within a Stocks and Shares ISA?
A Stocks and Shares ISA can hold individual UK and international shares, investment funds (unit trusts, OEICs), exchange-traded funds (ETFs), investment trusts, bonds, and gilts. The exact range depends on your platform. Most investors use index funds or ETFs as their core holding.
What is the average return from a Stocks and Shares ISA?
Historical returns depend on what you invest in. The FTSE 100 has returned around 7-8% annually including dividends over the long term. Global index funds tracking the MSCI World or FTSE All-World have returned 8-10% annually.
Past performance does not guarantee future returns. Our calculator uses 7% as a conservative default.
How much does it cost to open and run a Stocks and Shares ISA?
Platform charges typically range from 0.15% to 0.45% per year of your portfolio value. Fund charges (ongoing charges figure) range from 0.07% for index funds to 0.75%+ for actively managed funds. For a £10,000 portfolio, annual costs might be £15-50 for the platform plus £7-75 for fund charges. Low-cost index funds on a low-cost platform minimise drag on returns.
Can I withdraw from a Stocks and Shares ISA?
Yes, with most flexible ISAs you can withdraw money at any time and re-deposit it in the same tax year without affecting your annual allowance. However, you should consider investment timing risk - if markets have fallen, withdrawing means crystallising a loss. A Stocks and Shares ISA is best viewed as a long-term (5+ year) investment.
Stocks and Shares ISA vs Cash ISA: which is better?
For time horizons of 5 years or more, Stocks and Shares ISAs have historically outperformed Cash ISAs significantly. Over 20 years, the stock market has consistently beaten savings rates. However, investments can fall as well as rise, whereas cash is stable.
For short-term goals (under 3-5 years), Cash ISA is safer. For long-term wealth building, Stocks and Shares ISA typically wins.
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Official Sources
Data verified against official UK government sources. Last checked April 2026.