Stocks & Shares ISA Calculator

What Is a Stocks & Shares ISA?

A Stocks & Shares ISA (Individual Savings Account) is a UK tax wrapper that allows you to invest in equities, funds, ETFs, bonds, and investment trusts without paying any income tax on dividends or interest, and no capital gains tax (CGT) on profits — ever. The government-mandated annual subscription limit for 2025-26 is £20,000, which you can split across a Cash ISA, Stocks & Shares ISA, Innovative Finance ISA, and Lifetime ISA (up to £4,000 for LISA) in the same tax year.

2025-26 ISA Rules

• Annual allowance: £20,000 per tax year (April 6 – April 5)
• Tax on growth: Zero — no CGT, no dividend tax, no income tax on interest
• Withdrawals: Tax-free at any time, for any reason
• Carry forward: Unused allowance cannot be carried to the next tax year — use it or lose it
• Multiple ISAs: You can subscribe to one of each type per year (Cash, Stocks & Shares, IFISA, LISA)
• Flexible ISAs: Some providers allow you to withdraw and re-contribute within the same tax year without it counting as a new subscription
• Lifetime allowance: No limit on total ISA holdings — a pot can grow to any size tax-free

What Can You Invest in Within a Stocks & Shares ISA?

The investment universe inside a Stocks & Shares ISA is broad:

• Index funds & ETFs: The most popular choice — low-cost funds tracking global indices (FTSE All-World, S&P 500, MSCI World) provide diversification at 0.07–0.22% annual charges.
• UK and international shares: Individual company stocks listed on the London Stock Exchange, NYSE, NASDAQ, and other major exchanges.
• Investment trusts: Closed-ended funds listed on the LSE, often used for income (REITs, infrastructure trusts).
• Bonds & gilts: Government and corporate bonds for income-seeking investors or those approaching retirement.

Why the ISA Beats a General Investment Account

Outside an ISA, investments face two key taxes:

• Capital Gains Tax (CGT): Profits on disposal above the annual exempt amount (£3,000 for 2025-26) are taxed at 18% (basic) or 24% (higher/additional rate) for gains on shares.
• Dividend Tax: Above the £500 dividend allowance (2025-26), dividends are taxed at 8.75% (basic), 33.75% (higher), or 39.35% (additional rate).

Inside a Stocks & Shares ISA, you pay zero on both. For a higher-rate taxpayer investing £500/month for 20 years at 7% growth, the tax saving over a general account can exceed £40,000–£60,000 — which is why financial advisers consistently recommend maximising your ISA before a taxable account.

ISA vs SIPP: Which First?

Both are tax-efficient, but they serve different purposes. The SIPP gives an upfront tax deduction (20–45% relief) but locks money away until age 55–57. The ISA has no upfront relief but is fully flexible — you can access it at any age. General guidance: if your employer offers pension matching, grab that first (free money). Then maximise your SIPP for the tax relief if you're a higher-rate taxpayer. Then fill your ISA for flexible, accessible savings. For most people, a combination of SIPP (for retirement) and ISA (for flexibility) is optimal.

⚠️ This calculator provides estimates only. Investment returns are not guaranteed and your capital is at risk. ISA tax rules may change in future. CGT rates shown are based on 2025-26 HMRC rules. This does not constitute financial advice — consult an FCA-regulated adviser for personalised guidance.