Is an ISA better than a pension?

Not automatically. ISAs are usually more flexible because you can normally access the money. Pensions are usually more tax-efficient for retirement because contributions can benefit from tax relief, salary sacrifice or employer contributions.

What does this calculator compare?

It compares putting a monthly amount into an ISA with using the same take-home cost to fund a pension. It estimates pension tax relief, salary sacrifice savings, pension access, projected pot size and an after-retirement-tax estimate.

Does the calculator include the £100k Personal Allowance taper?

Yes, the calculator estimates the effect of the Personal Allowance taper for incomes above £100,000 under England, Wales and Northern Ireland Income Tax assumptions.

Tax wrapper decision tool

ISA vs Pension Calculator

Compare ISA flexibility with pension tax efficiency. Use the same take-home monthly amount and see what it could become inside an ISA or a pension; including salary sacrifice scenarios.

2026/27 UK rules reviewedTax relief modelled

ISA access

Shows the projected value of investing the monthly amount directly into an ISA.

Pension uplift

Estimates how tax relief or salary sacrifice can increase the gross amount invested.

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After-tax comparison

Compares the ISA value with an estimated pension value after retirement tax.

Your numbers

Current age Age you expect to access pension money Gross annual income

Monthly amount available from take-home pay

Pension route to compare Employer NI give-back if salary sacrifice

Expected annual investment return

Expected tax rate on taxable pension withdrawals

The pension estimate assumes 25% of the pension pot can be taken tax-free and the remaining 75% is taxed at the retirement tax rate you choose. The ISA side assumes tax-free growth and access under current ISA rules.

ISA vs pension result

Projected ISA value£0Flexible ISA route

Pension pot before retirement tax£0Gross pension route

Pension after estimated retirement tax£025% tax-free cash assumed

Estimated difference£0Pension vs ISA

What this means

Enter your figures to compare the two routes.

Save or share this scenario

The page URL captures the figures you entered, so you can come back to the same ISA vs pension comparison later.

Same monthly cost, different wrapper

This table keeps the same take-home monthly amount and estimates how much gets invested through different routes.

Route	Monthly cost	Estimated gross invested monthly	Projected pot	After-tax estimate	Access

Year-by-year projection

A simple view of how the ISA and after-tax pension estimate build over time.

Year	Age	ISA value	Pension after-tax estimate	Difference

Assumptions and review date

Last reviewed: 19 May 2026. The calculator uses 2026/27 UK Income Tax, National Insurance, ISA and pension allowance assumptions for England, Wales and Northern Ireland.

It simplifies pension tax relief and salary sacrifice so the trade-off is understandable. It does not model Scottish tax bands, student loans, child benefit, provider fees, investment charges, scheme rules, tapered annual allowance calculations in full, or future tax changes.

How to use this calculator

The useful answer is not always “pension wins” or “ISA wins”. The wrapper has to fit the job.

Pension usually wins on tax

If the money is genuinely for retirement, tax relief or salary sacrifice can give the pension a head start before investment growth even begins.

ISA usually wins on access

An ISA can be used before pension access age. That flexibility can be valuable for house deposits, career breaks, emergencies or earlier financial independence.

The split can matter more than the winner

Many households need both: pension for retirement efficiency, ISA for optionality before retirement.

Useful next reads

These guides explain the decisions behind the numbers.