HMRC gives ISA update as number of millionaires jumps by fifth

The number of “Isa millionaires” recorded by the revenue service has jumped by around a fifth in the space of a year. Some 4,850 savers had Isa pots worth £1 million-plus by the end of the financial year in 2022, according to HM Revenue and Customs (HMRC) figures.

This was up from 4,070 recorded the previous year. The latest figures were obtained following a freedom of information (FOI) request by money app Plum.

According to the data, the average Isa millionaire was sitting on a pot valued at £1,351,000 by April 2022. The top 25 Isa investors were sitting on pots averaging £8,880,000.

HMRC cautioned when releasing the data that, each year, some Isa managers may enter records incorrectly, or fail to submit, therefore the figures should be treated as a guide and may not reflect the true number of Isa millionaires. Highlighting the tax-efficient appeal of Isas, Rajan Lakhani, of smart money app Plum, said: “Isa millionaire wealth continues to grow, even as other savings and investment products lose a little of their shine following recent tax changes.

“A large part of the Isa’s appeal is the flexibility and liquidity it offers investors.”

Mr Lakhani added: “While only a fraction of savers will be able to amass a million pounds in their Isa, investing even small amounts regularly can add up to a significant sum over time, and go a long way to helping people meet their financial goals. That’s especially the case if you begin your investing journey early.

“Of course, it’s also important to have a rainy day fund, and a cash Isa is ideal for insulating yourself from future shocks, like a sudden job loss or poor health, or to use for things you need in the shorter term.”