Pension comparison

ISA vs Pension — Quick Notes

  • ISA: No tax relief on contributions, but no tax on growth or withdrawal. £20,000/yr allowance.
  • LISA: 25% government bonus on first £4,000/yr; restricted to first home or age 60.
  • Pension: Tax relief on contributions (20%/40%/45% depending on bracket). 25% tax-free at retirement, rest taxed as income.
  • Salary sacrifice pensions save NI on top of income tax — even more efficient.