What is the maximum limit of unique permissions that can be set to a SharePoint list item without compromising its performance? The Custom list does not have too many look up columns but one custom column which adds documents.
Maximum unique permission in a list is allowed 50,000 but as per Microsoft recommended is 5000
Reference Articles :
Software boundaries and limits for SharePoint Servers 2016 and 2019
SharePoint Permissions: Maximum number of unique permissions in a SharePoint library
The supported limit is 50,000, but the recommended general limit is 5,000. Making changes to more than 5,000 uniquely permissioned items at a time takes longer. For large lists, design to have as few unique permissions as possible.
As the number of unique permissions in a list increases, performance decreases. The throughput difference for operations on a list between 0 and 1,000 unique permissions is around 20 percent. I recommend that you consider lowering this limit to 5,000 unique permissions and for large lists consider using a design that uses as few unique permissions as possible. This will help not only performance, but also manageability.