Martin Lewis Stocks and Shares ISA Guide 2026

Scope: ISA rules are set by HM Revenue & Customs and apply across the UK. Tax treatment depends on individual circumstances and may change.

TL;DR

• New for 2026: HMRC now officially permits fractional shares in ISAs, making it easier to diversify with small amounts.
• The Deadline: The 2025/26 ISA allowance is £20,000. Use it by midnight on April 5th, 2026, or you lose it forever.
• The 5-Year Rule: Stocks and Shares ISAs are for long-term investing (5+ years). For shorter goals, stick to Cash ISAs.
• Tax Efficiency: Returns are 100% tax-free. This is even more vital now that dividend tax rates have risen to 10.75% for basic rate taxpayers in 2026.
• Fees are the Enemy: A 0.30% fee difference can cost you thousands over a decade.

What Is a Stocks and Shares ISA?

A Stocks and Shares ISA is a tax-efficient investment account regulated by HM Revenue & Customs. It allows UK residents to invest up to £20,000 per tax year without paying UK Income Tax or Capital Gains Tax on investment growth, dividends, or interest. Note: Capital is at risk and values can fall.

Best-Performing Low-Cost Index Funds (2026 Picks)

Martin Lewis fans typically avoid “star fund managers” and instead opt for Index Trackers. These are “boring” but effective funds that follow the whole market.

Based on performance and costs as of February 2026, here are the top picks for diversified ISA investing:

Lewis Tip: Most people should stick to the first three. They provide instant diversification. Don’t “chase” the tech returns of the L&G fund unless you have a high risk tolerance, as tech can be more volatile.

What Martin Lewis Says About Stocks and Shares ISAs in 2026

Martin Lewis, founder of MoneySavingExpert, consistently emphasizes three core principles for 2026:

1. Invest Long Term (Minimum 5 Years) Markets are volatile. Historically, the longer you hold, the lower the risk of losing money compared to cash.
2. Minimise Platform and Fund Fees Compounding works for you on returns, but against you on fees. “Don’t pay for bells and whistles you don’t use,” is a classic Lewis mantra.
3. Diversify via Index Funds Unless you are an expert, don’t pick individual stocks. Use low-cost “trackers” that follow the global economy.
4. The “LISA” Exception If you are under 40 and saving for your first home (up to £450,000), Martin recommends the Lifetime ISA (LISA) first to get the 25% government bonus before opening a standard Stocks and Shares ISA.

Stocks and Shares ISA vs. Cash ISA (2026 Comparison)

With the 2025 Autumn Budget hinting at future cuts to Cash ISA limits for some savers by 2027, 2026 is a “bridge year” for many moving into investments.

The Math: Why Fees Matter

If you invest £10,000 with 5% average annual growth for 10 years:

$$£10,000 \times 1.05^{10} = £16,289$$

If total annual fees are 0.20%, net growth becomes 4.8%:

$$£10,000 \times 1.048^{10} = £15,988$$

The Result: A tiny 0.20% fee difference eats £301 of your profit. Over 25 years, that gap grows to thousands.

Leading Stocks and Shares ISA Platforms (2026)

The market shifted in early 2026 as legacy platforms slashed prices to compete with “fintech” apps.

1. Vanguard Investor (The “Passive” King)

• Platform Fee: 0.15% (capped at £375). Note: Now subject to a £4/month minimum for very small balances.
• Best for: Beginners wanting “set and forget” global index funds.
• Verdict: Still the gold standard for low-cost, diversified investing.

2. Hargreaves Lansdown (The “Big Player” Pivot)

• Platform Fee: Reduced to 0.35% for funds in early 2026.
• Best for: Investors who want a mix of funds, individual shares, and top-tier research.
• Verdict: More expensive than Vanguard, but the 2026 fee cut and improved app make it much more competitive for active users.

3. Moneybox (The “Small Change” Specialist)

• Platform Fee: Monthly subscription + % fee.
• Best for: Beginners and those using “round-ups” to invest spare change.
• Verdict: Excellent interface. Now supports fractional shares, allowing you to own a piece of expensive US tech stocks with just £1.

To provide the most “Martin Lewis” style experience, I have calculated the annual cost for a £20,000 investment (the full annual allowance).

The table below reflects the significant fee changes implemented in February and March 2026 by the UK’s biggest platforms.

2026 Platform Fee Comparison (£20,000 ISA Portfolio)

Calculated based on holding low-cost index funds (average 0.15% fund fee) with no active share trading.

*Note: HL’s new 2026 pricing applies to funds. If you hold only shares/ETFs, the fee is capped at £150/year.

3 Golden Rules for Using This Table

1. The “Vanguard Threshold”

Because Vanguard now has a £4 monthly minimum fee, it is actually more expensive than AJ Bell for very small portfolios (under £19,200). If you are starting with a small amount, AJ Bell or a cashback app might be cheaper until your pot grows.

2. The “Flat Fee” Flip

If your portfolio grows to £100,000, Vanguard would cost you £150/year, while Interactive Investor (on their ‘Core’ plan) stays at roughly £72/year. Martin Lewis often suggests switching to a “flat fee” provider once your pot is large enough that percentage fees start to “sting.”

3. Factor in “Regular Savings” (RSP)

Many of these platforms (like Fidelity and HL) waive certain fees or lower their transaction costs if you set up a monthly Direct Debit. In 2026, automation isn’t just convenient—it’s usually cheaper.

How to Choose the Right ISA in 2026

1. Check the “Total Cost”: Look for the Platform Fee + Fund Charge (OCF).
2. Fractional Shares: If you want to buy big names (like Amazon or Apple) but don’t have thousands, ensure the platform supports fractional trading (now HMRC-approved).
3. Transferability: Ensure the platform allows “In-Specie” transfers so you can move your investments elsewhere later without selling them.
4. Service Level: Do you need a human on the phone? If yes, HL or AJ Bell are better than “app-only” providers.

Is This Financially Worth It?

• Scenario A (Saving for a 2027 Wedding): No. Stick to a high-interest Cash ISA. The stock market is too “jumpy” for a 1-year window.
• Scenario B (Retirement in 15 Years): Yes. The power of tax-free compounding inside an ISA is the most effective way for most UK residents to build wealth.
• Scenario C (High Dividend Earner): Yes. With 2026 tax changes, shielding your dividends inside an ISA is now more profitable than ever compared to a standard brokerage account.

Here is the updated section, written as a high-value, step-by-step guide ready to be pasted directly into your blog. It reflects the latest 2026 rules and “Martin-style” warnings.

How to Transfer Your ISA in 2026: The Step-by-Step “Golden Rule” Guide

If your current ISA provider is stinging you with high fees or a clunky app, it’s time to move. In 2026, the process is almost entirely digital, but there is one “Golden Rule” you must never break: Never withdraw the money yourself.

If you manually move the cash to your bank account, you strip it of its “tax-free wrapper.” Any re-deposit will count toward your £20,000 annual limit. Instead, follow this official “Martin-approved” process to keep your tax perks intact.

Step 1: Check for “Exit Fees”

Before you jump ship, check if your current provider charges a penalty for leaving.

• The Good News: Many modern platforms like Vanguard and Moneybox don’t charge exit fees.
• The Better News: In 2026, many big players (like HL, Bestinvest, and Fidelity) will offer to cover your exit fees up to £500 if you transfer a balance over a certain amount (usually £5k–£10k).

Step 2: Choose Your Transfer Type

You’ll be asked if you want a Cash Transfer or an In-Specie Transfer.

• Cash Transfer (Fastest): Your current provider sells your investments and moves the cash. You’ll be “out of the market” for 2–3 weeks, meaning if stocks soar while the money is moving, you miss out.
• In-Specie Transfer (Smoothest): Your actual shares and funds are moved without being sold. You stay invested throughout. Note: This only works if your new platform offers the exact same funds.

Step 3: Open the New Account

Go to the website of your chosen 2026 provider (e.g., AJ Bell or Vanguard) and open a “Stocks and Shares ISA.” You will need:

• Your National Insurance (NI) Number (HMRC now requires this upfront for all 2026 applications).
• Your Existing ISA Account Number (found on your latest statement or app).

Step 4: The “Electronic Handshake”

Inside your new account, click “Transfer an ISA.” You just fill in the details of your old provider and the amount (you can now do partial transfers of current-year money thanks to recent rule changes). Your new provider then does the “heavy lifting” by contacting your old one.

Step 5: The “Blackout Period”

The transfer typically takes 15 to 30 working days. During the final week, your old account will likely be “locked”—you won’t be able to buy or sell while the electronic records move. Don’t panic; this is the home stretch!

2026 Transfer Quick-Reference

People Also Ask (PAA) & FAQs

How much can I invest in 2026?

The limit is £20,000 for the 2025/26 tax year. You can split this between a Cash ISA, Stocks & Shares ISA, and LISA, provided the total is under £20k.

Are Stocks and Shares ISAs really tax-free?

Yes. You pay no UK Income Tax and no Capital Gains Tax on growth. This is set by HMRC and is one of the few remaining “tax havens” for the average person.

Can I lose all my money?

While possible if you buy a single failing company, it is extremely rare if you are diversified across hundreds of companies via an index fund. However, your balance will go up and down.

Can I transfer an old ISA?

Yes. Use the official transfer process provided by your new platform. Do not withdraw the cash yourself, or you will lose the “tax-free wrapper” status of that money.

What is the minimum age?

You must be 18 or over and a UK resident for tax purposes.