What is the Lump Sum Investment Calculator?
The Lump Sum Investment Calculator helps you decide how to allocate a large one-off sum of money across UK investment vehicles in the most tax-efficient way. It is designed for situations such as a business sale, inheritance, redundancy payout or other windfall, and shows how different allocation choices affect long-term returns, tax paid and overall wealth.
How the Calculator Works?
You enter the size of your lump sum and decide how to split it across pensions, ISAs, taxable investments and cash. The calculator then applies UK tax rules, allowances and growth assumptions to project how each allocation performs over time.
It checks ISA and pension allowances, applies pension tax relief, models tax on dividends, capital gains and savings interest, and compares your strategy against the alternative of leaving the money in cash. All results are shown clearly so you can see how tax efficiency and compounding work together over your chosen investment horizon..
Step One: Allocate Your Lump Sum
Enter the total lump sum and choose how to split it across pensions, ISAs, cash, taxable investments and other options. You can also choose whether to invest in one year or spread contributions over multiple tax years.
Step Two: Set Tax and Planning Assumptions
Add your income tax band, other taxable income, investment horizon, inflation assumption and allowance settings. The calculator checks pension and ISA limits and applies the correct UK tax rules.
Step Three: Compare Outcomes and Optimise
Review future values, total growth, tax paid and tax saved by using different wrappers. Adjust allocations to see how small changes can materially improve long-term outcomes.
Lump Sum Investment Calculator
Step 1: Lump sum and split
Step 2: Assumptions, allowances and tax position
Step 3: Returns by vehicle
| Vehicle | Allocated | Effective start | Return used | Future value | Growth |
|---|
Disclaimer:
This calculator provides illustrative projections only and does not constitute financial or tax advice. Tax rules, allowances and investment returns can change. Consider speaking with a qualified financial adviser before investing a large lump sum.
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What is the Lump Sum Investment Calculator?
It is a UK-specific planning tool that helps you allocate a lump sum across pensions, ISAs, taxable accounts and cash, showing how tax efficiency and compounding affect long-term outcomes.
What does this calculator help me decide?
It helps you decide how to allocate a lump sum across UK investment vehicles to balance growth, tax efficiency and accessibility.
Does it include pension tax relief?
Yes. Pension contributions are modelled with relief at source, including the government top-up based on your income tax band.
Does it check ISA and pension allowances?
Yes. The calculator flags when ISA or pension contributions exceed annual allowances and highlights potential issues.
How are taxable investments handled?
GIA investments account for dividend tax, capital gains tax and annual exemptions. Cash holdings consider savings interest and personal allowances.
Why does the calculator compare investing vs leaving money in cash?
To highlight the long-term cost of holding large sums in cash. Inflation and tax can significantly erode purchasing power over time, even when interest rates appear attractive.
Can I spread the investment over multiple years?
The calculator breaks down how much each child receives, including deposit support, invested growth and their share of the inherited property.
Is this calculator about reducing inheritance tax?
Yes. You can choose to invest the lump sum gradually to make use of multiple years of allowances.
Does this include Premium Bonds?
Yes. Premium Bonds are included as a separate allocation with their expected prize rate modelled.
Are the results shown in today’s money
Yes. You can model results in real terms to reflect inflation-adjusted spending power.
How accurate are the projections?
They are estimates based on your assumptions. The calculator is best used to compare strategies rather than predict exact outcomes.
Is my data stored?
Inputs can optionally be saved in your browser using local storage. Nothing is sent or stored externally.