How we calculate

Accuracy is the whole point. Every rate below is taken directly from the official authority, dated, and covered by automated golden, boundary and invariant tests built from the published rules. Where an authority publishes a reproducible example, we retain it as a separate reference case. If a Budget changes a rate, we update the source-of-truth file and re-run the full release suite.

Mortgage affordability

We estimate borrowing as income × multiple (default of 4.5×, adjustable 4–5.5×), reduced for committed monthly spending. We then apply an FCA-style stress test, re-checking the payment at your rate plus a margin (default 1.0%).

The Bank of England limits lenders to advancing no more than 15% of new mortgages at 4.5x income or above — a portfolio rule, not a hard per-borrower cap. Source: FCA interest-rate stress-test rule.

Take-home pay (2026/27)

The personal allowance is £12,570, reduced by £1 for every £2 of income above £100,000 (source). Income tax bands below are in taxable income — what's left after your allowance. National Insurance (Class 1 employee) is 8% between £12,570 and £50,270, then 2% above (HMRC, verified 2026-07-25). When a payroll frequency is selected, National Insurance and student-loan repayments use the published weekly, fortnightly, four-weekly or monthly thresholds and payroll rounding rather than simply dividing annual results.

Percentage pension contributions can use all cash pay, base salary, an employer-defined annual amount, or the 2026/27 automatic-enrolment qualifying band. That band applies only to earnings from £6,240 to £50,270 (DWP, verified 2026-07-27). Employer contributions in this calculator remain an explicit percentage of base salary.

Retirement forecast

Projections run in today's money: the growth rate (default 3%, adjustable) is applied after inflation. The annual assumption is converted to its equivalent monthly rate before compounding, so a 3% annual input remains 3% over a full year. At retirement the pot pays your chosen withdrawal rate (default 4%); the full new state pension of £12,548 a year (£241/week, GOV.UK, verified 2026-07-25) is added from age 67 (state pension age) by default. A user can instead enter the annual amount and age from their personal GOV.UK State Pension forecast. Retirement income is taxed with the 2026/27 income tax bands above — pension income pays no National Insurance. A couple forecast treats the entered pot and contributions as combined, splits private pension income equally across two personal allowances and includes two full State Pensions when selected. A custom couple entry is treated as one combined annual amount with one shared start age, so materially different individual ages should be modelled separately. Actual tax depends on whose name each pension is held in. Simplifications: contributions are level in real terms, the 25% tax-free lump sum is ignored (conservative), and pension annual allowance, tapering, carry forward and scheme charges are not applied. The optional planning range moves the selected real-growth assumption 1.5 percentage points lower and higher, bounded to 0%–6%, while holding every other input constant; it is a sensitivity check, not a return forecast. The 4% guideline derives from the Bengen/Trinity studies; UK practitioners often prefer 3–3.5% for early retirement.

Planning and comparison models

The buy-vs-rent, overpayment, remortgage, emergency-fund and debt-payoff tools are projections rather than statutory calculations. Every forecast-driving assumption is editable. Mortgage balances and interest are simulated monthly; buy vs rent also keeps the starting cash and monthly budget equal between the two paths. Debt payments roll forward after each balance clears. Downside house-price, rent and investment-return assumptions can be entered as negative rates. We do not insert a house-price, rent, investment-return or emergency-fund forecast that the user cannot see.

These models deliberately exclude unknowable personal values such as moving flexibility, investment risk tolerance and job security. Their results are decision support, not a recommendation.

Optional spending balance

The Home and buffer journey can optionally compare a completed monthly budget with the 50 / 30 / 20 rule or percentages chosen by the user. The rule is a reference point, not a UK affordability standard, score or recommendation. Plainly always shows the actual allocation first and preserves money without an entered purpose as unassignedrather than assuming it is lifestyle spending.

Essentials are the household essential costs already entered plus one twelfth of known annual essential costs. Future-you money is monthly cash saving, debt repayments above the entered minimums and, when selected, the personal take-home cost of payroll pension saving. That pension cost is added back to planning resources and then allocated to Future you, so it is represented without reducing unassigned cash twice. Employer pension contributions are excluded because they were never spendable household income.

Percentage coaching is withheld when the entered allocations exceed available resources, custom percentages do not total 100%, or the user says a priority household bill is behind. Variable earners can use regular pay without bonus and overtime. Emergency-fund milestones continue to use actual essential costs rather than a spending-rule percentage.

Guidance sources: MoneyHelper Budget planner, budgeting for irregular income, emergency savings, sinking funds and StepChange priority debts. The optional 50 / 30 / 20 reference follows the US CFPB worksheet, which also describes such rules as adaptable guidelines.

Savings interest tax (2026/27)

Savings interest is stacked above other income after any unused personal allowance. The starting rate for savings can shelter up to £5,000, reduced £1 for every £1 of non-savings income above the personal allowance. The Personal Savings Allowance is £1,000 for a basic-rate taxpayer, £500 for a higher-rate taxpayer and £0 at the additional rate. Any remainder is allocated across the 20%, 40% and 45% UK savings bands. For Scottish taxpayers, the calculator also uses the Scottish rate reached by non-savings income to select the £1,000, £500 or £0 allowance. A known annual-interest total can replace the balance-and-rate estimate.

Source: GOV.UK tax on savings interest and income tax rates and allowances. Verified 2026-07-12.

ISA vs pension

Both routes start with the same reduction in take-home pay. A Stocks and Shares ISA invests that amount directly. Relief at source separates the payment to the provider, its basic-rate top-up and any additional tax relief reclaimed by the user. Salary sacrifice separates gross pay exchanged from income-tax and employee-NI savings. From April 2029 the projection limits NI-free salary sacrifice to £2,000 a year. Employer matching is added separately. At the end, the chosen pension tax-free share and withdrawal tax are applied.

The allowance check combines new and already-used ISA or pension input. It uses the ISA allowance of £20,000 and an editable pension annual allowance, initially £60,000. Users with a tapered or money-purchase annual allowance can enter their own limit and can optionally check personal relief-at-source contributions against relevant UK earnings.

Sources: ISA rules, pension tax relief, pension annual allowance, salary sacrifice from April 2029, and normal minimum pension age. Verified 2026-07-12.

Child Benefit and HICBC (2026/27)

Child Benefit uses weekly rates of £27.05 for the eldest child and £17.90 for each additional child. The High Income Child Benefit Charge starts above £60,000 of individual adjusted net income and rises by 1% of the benefit for each complete £200, reaching 100% at £80,000. Gross pension and grossed-up Gift Aid entries reduce adjusted net income in the model.

Sources: HMRC Child Benefit rates and HICBC guidance. Verified 2026-07-12.

Universal Credit screening (2026/27)

The benefits check adds the selected monthly standard allowance, child, disabled-child, eligible housing, childcare, carer and LCWRA elements. Net earnings above any work allowance are reduced by the 55% taper. Capital above £6,000 creates assumed monthly income of £4 for every £250 or part; capital at or above £16,000 is included in the tariff calculation, while capital above that amount prevents an award in the screen. Registered childcare is included at 85%, subject to the published monthly caps.

Property-transaction tax (stamp duty)

These calculators provide general information, not financial advice. Individual lender criteria and personal circumstances vary — always confirm figures with a qualified adviser, your lender, or the relevant tax authority before acting.