Should I use a pension or an ISA?

This calculator does not decide that for you. It compares scenarios using your assumptions. Pensions can receive tax relief but have access restrictions; ISAs are usually more flexible but do not receive pension tax relief.

Does this include salary sacrifice?

Yes, optionally. If enabled, the calculator estimates how employee NI saving and employer NI shared into the pension can increase the gross pension contribution.

Does this check pension annual allowance or ISA allowance?

No. The calculator does not check annual allowance, tapering, carry forward, ISA subscription limits, or eligibility. It is a comparison model only.

Why does the pension result include retirement tax?

Pension contributions may receive tax relief on the way in, but taxable pension withdrawals can be taxed later. The calculator estimates accessible value using your tax-free cash and withdrawal tax assumptions.

Is this financial advice?

No. It is scenario modelling and does not consider your full tax position, access needs, employer benefits, investment risk, allowances, or personal circumstances.

UK wrapper planning

Pension vs ISA Calculator

Compare putting the same monthly net-pay cost into a pension or stocks and shares ISA using UK tax relief, salary sacrifice, growth, and retirement access assumptions.

Use this pension vs ISA calculator to compare the same monthly net-pay cost across two common UK long-term saving wrappers. The result is a scenario comparison, not a recommendation.

Inputs

Compare the same monthly net-pay cost going into an ISA or pension.

Monthly amount (£)

Time horizon (years)

Annual growth rate (%)

Marginal tax rate (%)

Employee NI saving (%)

Employer NI shared (%)

Pension tax-free cash (%)

Retirement withdrawal tax (%)

Include salary sacrificeGross up the pension contribution for employee NI saving and any employer NI shared.

Results

Compare ISA value with estimated pension value after retirement tax assumptions.

Enter your assumptions and calculate to compare ISA and pension scenarios.

Assumptions

What this pension and ISA comparison assumes

These assumptions keep the comparison transparent and separate calculator output from advice.

Monthly cost

Same net-pay cost

The ISA receives the monthly amount directly. The pension contribution is grossed up using your tax and salary sacrifice assumptions.

Tax relief

Marginal-rate estimate

The calculator estimates pension gross-up from the marginal tax rate you enter. It does not check allowance limits or provider mechanics.

Salary sacrifice

Optional NI uplift

If enabled, employee NI saving and any employer NI share increase the estimated pension contribution.

Growth

Same annual growth rate

Both paths use the same monthly compounding assumption. Fees, asset allocation differences, and sequence risk are not modelled.

Pension access

Tax-free cash plus taxable withdrawals

The model estimates accessible pension value using a tax-free cash percentage and retirement withdrawal tax rate.

ISA rules

No tax on access modelled

The ISA path assumes tax-free access but does not check annual ISA allowance usage or wrapper eligibility.

Examples

Common pension vs ISA scenarios

Use these examples to test tax relief, salary sacrifice, and access trade-offs.

Higher-rate taxpayer

A higher-rate taxpayer compares ISA flexibility with pension tax relief.

Enter the same monthly net-pay cost you could afford to save.
Use your current marginal tax rate for the pension gross-up estimate.
Adjust retirement withdrawal tax to test how future tax could affect access value.

Salary sacrifice workplace pension

An employee tests whether NI savings materially change the pension path.

Enable salary sacrifice if your employer uses it for pension contributions.
Enter any employer NI saving passed into your pension.
Check your payroll and pension provider rules before relying on the result.

Flexibility vs retirement lock-up

A saver compares ISA access before retirement with pension access later.

ISA values are easier to access but do not receive pension tax relief.
Pension values may be higher after relief but are normally locked until pension access age.
The calculator shows the trade-off without recommending one wrapper.

FAQ