SIPP vs LISA Calculator
Which is better for your retirement savings? Compare the tax relief of a Self-Invested Personal Pension (SIPP) against the 25% bonus of a Lifetime ISA (LISA). See exactly how your net wealth changes depending on your current and future tax brackets.
LISA is penalty-free at 60. SIPP is 55 (rising to 57).
The actual cash you can afford to invest each year.
Higher brackets get more SIPP tax relief.
SIPP withdrawals (after the 25% tax-free lump sum) are taxed as income.
SIPP Retirement Tax
£49,829
Estimated tax on withdrawal
SIPP Assumption: You reinvest any higher/additional rate tax rebate back into the pension to maximize compounding. SIPP value is shown after retirement tax (assuming 25% tax-free, 75% taxed at your selected retirement rate).
LISA Assumption: If you invest more than the £4,000 LISA limit, the excess spills over into a standard Stocks & Shares ISA. LISA and ISA withdrawals are 100% tax-free.
Projected Growth (Gross Balance)
Year-by-Year Breakdown
| Age | SIPP Gross In | SIPP Rebate | SIPP Balance | LISA + Bonus In | LISA Balance | Spillover ISA Balance |
|---|---|---|---|---|---|---|
| 31 | £5,000 | £0 | £5,000 | £5,000 | £5,000 | £0 |
| 32 | £5,000 | £0 | £10,250 | £5,000 | £10,250 | £0 |
| 33 | £5,000 | £0 | £15,763 | £5,000 | £15,763 | £0 |
| 34 | £5,000 | £0 | £21,551 | £5,000 | £21,551 | £0 |
| 35 | £5,000 | £0 | £27,628 | £5,000 | £27,628 | £0 |
| 36 | £5,000 | £0 | £34,010 | £5,000 | £34,010 | £0 |
| 37 | £5,000 | £0 | £40,710 | £5,000 | £40,710 | £0 |
| 38 | £5,000 | £0 | £47,746 | £5,000 | £47,746 | £0 |
| 39 | £5,000 | £0 | £55,133 | £5,000 | £55,133 | £0 |
| 40 | £5,000 | £0 | £62,889 | £5,000 | £62,889 | £0 |
Frequently asked questions
Should I use a SIPP or a LISA for retirement?
If you are a basic rate taxpayer, a LISA often wins because withdrawals are entirely tax-free, whereas SIPP withdrawals are only 25% tax-free. If you are a higher or additional rate taxpayer, a SIPP is usually better due to the 40% or 45% upfront tax relief, which strongly outweighs the tax paid on withdrawal. You should also consider employer pension matches before using either.
What happens if I need the money early?
A LISA can only be accessed penalty-free to buy your first home (up to £450,000) or from age 60. If you withdraw for other reasons, you pay a 25% penalty charge, which reclaims the bonus plus a small portion of your own money. A SIPP cannot be accessed at all until age 55 (rising to 57 in 2028).
Does the LISA bonus stop at age 50?
Yes. You can only open a LISA between ages 18 and 39. You can contribute and receive the 25% government bonus up to age 50. After your 50th birthday, you can no longer pay into the LISA, though it will continue to earn interest or investment growth until you withdraw at 60.
How does SIPP tax relief work?
For a basic rate taxpayer, for every £80 you pay in, the government adds £20 (making £100). Higher rate taxpayers get the same £20 added to the pension, but can claim another £20 back as cash via a self-assessment tax return. To maximize growth in a SIPP, higher rate taxpayers should reinvest this cash rebate into their pension.