Cash ISA savings have climbed by almost £165 billion in just over two years, with balances reaching £486.3 billion by August 2026, according to new analysis by Yorkshire Building Society.
The surge follows the Government's decision to maintain the £20,000 annual Cash ISA allowance. Total balances rose from £321.5 billion in January 2024 to £486.3 billion by August 2026, while the number of accounts increased by more than five million over the same period, from 21.7 million to 27 million.
The figures highlight the growing popularity of Cash ISAs as savers look to protect their interest from tax while benefiting from the security and accessibility of cash savings.
More savers facing tax on interest
A separate Yorkshire Building Society analysis found the number of non-ISA savings accounts likely to generate enough interest to exceed the Personal Savings Allowance (PSA) rose from around 462,000 in January 2018 to 5.1 million in August 2026.
The PSA allows basic-rate taxpayers to earn up to £1,000 in savings interest tax-free each year, while higher-rate taxpayers can earn £500 before tax is due.
From April 2027, the rates of tax applied to savings interest above the PSA and outside ISAs will increase by four percentage points. Basic-rate taxpayers will pay 24%, higher-rate taxpayers 44% and additional-rate taxpayers 49%.
Cash ISAs remain a trusted option
Tina Hughes, director of savings at Yorkshire Building Society, said: "The decision to maintain the Cash ISA allowance at £20,000 is a positive outcome for millions of savers.
"At a time when more people are earning meaningful returns on their savings and looking carefully at how to protect those returns from tax, Cash ISAs continue to provide a simple, trusted and effective solution."
Ms Hughes added: "Our analysis shows that demand for Cash ISAs remains strong, with over five million more accounts now when compared to early 2024 and with balances increasing by almost £165 billion over that timeframe.
"That growth demonstrates the important role they play in helping people build financial resilience, save for major life events and work towards goals such as buying a home."
Keeping more of what they earn
She said the Budget's changes to savings taxation made tax-efficient accounts increasingly important. "For many people, Cash ISAs will play an increasingly important role in helping them keep more of what they earn," she said.
Ms Hughes also stressed that savers should retain the choice between cash savings and investments. "Many people value the certainty and security that cash savings provide, and Cash ISAs remain an accessible, tax-efficient way to save," she said.
The building society said Cash ISA deposits also help fund mortgage lending, supporting homeownership and contributing to the wider economy.
