ISAs are experiencing a resurgence in popularity, as savers rush to protect their interest from tax, says Yorkshire Building Society.
Since speculation began in February that the Chancellor may cut the current £20,000 cash ISA allowance in the Autumn Budget, Yorkshire Building Society has seen a sharp year-on-year increase in ISA activity.
There has been a 30% increase in ISA accounts opened and almost 50% increase in balances between February and August 2025 compared to the same period of 2024.
The surge in demand reflects growing concern among savers not only about potential cuts to the allowance, but breaching the Personal Savings Allowance and paying tax on their interest, particularly as tax thresholds remain frozen, the mutual said.
Data from the Bank of England also showed that cash ISA balances grew by £42.85 billion between February and August 2025, outpacing the £36.31 billion increase seen over the same period in 2024.
According to Yorkshire Building Society’s research, the average Brit has £27,561 in savings, putting many at risk of paying tax unless they use tax-efficient accounts like ISAs.
Chris Irwin, director of savings at Yorkshire Building Society, said: “Savers have spent years earning next to nothing on their money. Now, ISAs are helping them rebuild, offering everyday people a fair, tax-free return on their savings. But, just as they’re starting to find their feet again, many are worried about the creeping hand of tax on their hard-earned interest.”
Yorkshire Building Society has been campaigning to keep the ISA allowance since speculation of changes began at the start of the year and is calling on customers to make the most of the ISA allowance before any potential changes are made.
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