Annuity Calculator: Quote Income After Tax
See how tax and inflation affect an entered lifetime-annuity quote. Use the income for your chosen purchase amount and contract terms; this calculator does not supply market pricing.
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A quote reflects factors such as age, health, payment timing, increases and dependant benefits. Fixed percentage deductions cannot reliably price those features. Enter the quote or a clearly chosen hypothetical income instead.
Use an amount after any upfront cash. The illustration assumes payments while the annuitant is alive and covers only the selected full model years; it does not value life expectancy, death benefits or a fixed-term maturity payment.
Use a provider quote or clearly chosen scenario. This tool does not retrieve market rates or price age, health, joint-life cover or guarantees. Enter the fund committed after any tax-free cash and the starting income quoted for that same amount.
Your annuity quote and assumptions
No cash is deducted here. If you change this amount, update the quote too; income is not repriced automatically.
Enter the annual amount from a current quote, or your own hypothetical amount. There is no assumed market rate.
Only level or known fixed increases are projected. RPI/CPI-linked payment rules, caps and lags need separate modelling.
Include only income already in payment. Held constant in cash terms; no automatic full State Pension, savings or dividends.
Used only to show purchasing power. It does not change a level annuity or forecast an index-linked payment.
1–50 whole years. Assumes the annuitant survives throughout; no mortality, survivor or death-benefit projection.
Enter a starting annual gross income to see the illustration. No quote or personal entitlement is assumed.
How the annuity illustration works
Reviewed 16 October 2026. Start with the annual gross income quoted for the amount actually committed after any cash or other allocation. The calculator does not deduct cash again or rescale income when you change that amount. Update the quote if the purchase amount or terms change.
For each full model year, level income stays unchanged or the entered fixed increase applies from year two. Tax is the difference between combined-income tax and tax on your other income alone. The model uses 2026/27 UK/Scottish non-savings rates and the standard allowance taper, with no employment NI deduction from pension income.
Other income and tax thresholds remain constant in cash terms. Net income divided by the assumed cumulative inflation factor shows purchasing power in starting-year pounds. Actual future tax law, inflation and PAYE deductions can differ.
Worked example: gross quote to net income
For a hypothetical £150,000 purchase amount and £15,000 annual gross quote, with no other income, standard England/Wales/NI Income Tax is £486. Net income is £14,514 a year, or a £1,209.50 monthly budget equivalent. These are arithmetic inputs, not a current market offer.
If other taxable non-savings income is £30,000 instead, the extra tax on the same £15,000 annuity is £3,000, leaving £12,000 net annuity income. The £30,000 is not added to the displayed net result. Scottish tax can differ.
What the quote should already include
Confirm single or joint life, any dependant percentage, level or increasing payments, payment frequency and timing, guarantee period, value protection, fees and any health/lifestyle assessment. The model prices none of those options and does not add a generic enhancement or discount. Check existing guaranteed annuity rates and cancellation terms before changing arrangements.
Level or fixed-percentage lifetime annuities are the modelled scope. RPI/CPI-linked, investment-linked and fixed-term contracts, purchased-life annuity tax treatment, means-tested benefits and survivor/death-benefit payments are excluded.
Annuity calculator questions
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