Subsea permafrost carbon pools below the Arctic shelf seas are a major unknown in the global carbon cycle. We combine a numerical model of sedimentation and permafrost evolution with simplified carbon turnover to estimate accumulation and microbial decomposition of organic matter on the pan-Arctic shelf over the past four glacial cycles. We find that Arctic shelf permafrost is a globally important long-term carbon sink storing 2822 (1518–4982) Pg OC, double the amount stored in lowland permafrost. Although currently thawing, prior microbial decomposition and organic matter aging limit decomposition rates to less than 48 Tg OC/yr (25–85) constraining emissions due to thaw and suggesting that the large permafrost shelf carbon pool is largely insensitive to thaw. We identify an urgent need to reduce uncertainty in rates of microbial decomposition of organic matter in cold and saline subaquatic environments. Large emissions of methane more likely derive from older and deeper sources than from organic matter in thawing permafrost.