Savers moved an additional £42bn into cash ISAs during the first six months of 2024 as they looked to shield their money from tax, analysis by Paragon Bank has shown.

At the end of June, Paragon’s analysis of CACI data revealed that there was £351.6bn held in adult cash ISAs, compared to £309.3bn at the end of December 2023.

Breaking down the growth by product, fixed-term cash ISAs led the surge, increasing from £157.9bn to £188.5bn over the six-month period. Instant Access ISA balances also registered a boost, climbing by £11.2bn to reach £156.4bn.

Paragon’s findings also highlighted that the value of cash held in fixed-rate ISAs surpassed that of their non-ISA equivalents in June, the first time this has occurred since November 2022.

Overall, total adult cash savings balances have increased by £70.7bn to total £1.18trn during the first half of the year.

Paragon managing director of savings, Derek Sprawling, commented: “The level of deposits held in cash ISAs has rocketed in recent months, particularly in the fixed-rate segment of the market which has seen the level of balances double since the end of 2022.

“The increase is understandable given the growth in savings rates means more savers are facing the prospect of paying tax on money held in non-ISA accounts. Even though rates have moderated from their peak, there are still plenty of higher-rate taxpayers who could still benefit from utilising their ISA allowance to limit their exposure.”

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