ISA millionaire population estimated to have trebled over past three years

The number of people with ISA portfolios worth £1m or more is expected to total around 17,600 by April 2026, representing a threefold increase since the start of the 2023/24 tax year, analysis of HMRC figures by Rathbones has shown.

HMRC data, obtained by Rathbones via a freedom of information request, showed that 5,070 people were ISA millionaires at the beginning of the 2023/24 tax year.

A further 48,160 individuals had ISA holdings between £500,000 and £750,000, and 9,430 had between £750,000 and £950,000, while 1,210 were on the cusp of becoming ISA millionaires with between £950,000 and £1m in April 2023.

Assuming 8 per cent annual investment growth and the full use of the £20,000 ISA allowance each year, Rathbones estimated there would be around 17,600 ISA millionaires by April 2026.

Under higher return assumptions, the number of ISA millionaires could be greater than Rathbones’ estimation.

The wealth management firm noted that the figures assumed uninterrupted saving behaviour, with investors close to £1m gradually crossing the threshold over the three years.

The number of ISA millionaires had at least doubled every three years since 2016, and more than trebled during three-year periods when MSCI World returns were greater than 15 per cent.

As global equities had delivered annualised returns of 17.4 per cent since April 2023, Rathbones noted that conditions were similar to previous periods of ISA millionaire growth.

“Our analysis of the data suggests the number of ISA millionaires is likely to have risen significantly over a relatively short period, even on modest assumptions,” said Rathbones senior investment director, Angela Smith.

“This means many more investors are now benefiting from tax-free growth, income and dividends on seven-figure portfolios.

“Our experience with clients shows that the not-so-secret ingredients behind building an ISA millionaire portfolio are patience, time, consistently using ISA allowances, and avoiding interruptions to the power of compounding.”

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