The number of ISA millionaires has hit a record high of 5,070, according to new figures from money app Plum.

A freedom of information (FOI) request by the group revealed the number of millionaires tracked by HMRC jumped by 5 per cent during the 2022/23 tax year, the latest data available, from the 4,850 millionaires recorded the previous year.

According to HMRC data, the top 25 ISA investors are sitting on pots averaging £11.3m – up by £2.4m (27 per cent) in the space of 12 months.

Meanwhile, the average ISA millionaire is sitting on a pot of £1.3m, which was a level unchanged year-on-year.

Plum’s Rajan Lakhani commented: “The ISA millionaire club just got bigger, with 220 new members joining its ranks thanks in part to the US-driven AI-gold rush.

“Those at the top of the tree have, in some cases, seen their pots grow by more than £2m in the space of just 12 months, without a single penny of tax to pay on their gains.

“There’s no question that the rise of the so-called Magnificent Seven – Wall Street’s leading tech stocks including Nvidia – have helped balloon the pots of armchair investors here in the UK in recent years. So far, we see no evidence of that appetite for US tech giants dampening.”

Plum’s analysis showed that ISA millionaire numbers have now increased by 1,026 per cent since 2016, when they stood at just 450.

The number of ISA millionaires, which are counted by HMRC on 5 April each year, has dipped in just one year in this time since, which was in 2020 at the beginning of the Covid-19 pandemic.

Ahead of the upcoming Budget, Lakhani also noted that the government has made it clear it wants to “foster a greater retail investment culture in the UK”.

“In that arena, nobody is expecting changes to the tax-free status of ISAs themselves, or a change to the £20,000 allowance for stocks & shares ISAs,” Lakhani added.

“However, Chancellor, Rachel Reeves, is reportedly considering lowering the annual allowance for cash ISAs specifically, a proposal which is dividing public opinion sharply.”

---