Comparison · Investing & Employment · 2026/27
Save As You Earn (SAYE) vs Share Incentive Plan (SIP) UK 2026/27
SAYE combines risk-free monthly saving with a fixed-price share option. A Share Incentive Plan lets you buy shares from pre-tax salary, often with free or matching shares. This 2026/27 guide compares risk, tax treatment and how each works.
Key facts -- 2026/27
- • SAYE monthly savings: GBP 5-500
- • SAYE term: 3 or 5 years
- • SIP partnership shares: up to GBP 1,800/year or 10% of salary
- • SIP free shares: up to GBP 3,600/year
- • SIP tax-free holding period: 5 years
- • SIP-to-ISA transfer window: 90 days after leaving
How Each Scheme Works
SAYE is essentially a risk-free savings product with an attached share option -- you save monthly, and at the end of the term choose whether the fixed option price is attractive relative to the current share price. There is no way to lose the money you saved.
SIP is more directly an equity ownership scheme -- you buy shares from pre-tax salary (with tax and NI savings) and may receive additional free or matching shares from your employer, all held in trust with a path to fully tax-free withdrawal after 5 years.
Worked Example: GBP 200/Month Contribution
| Scheme | Downside if share price falls | Upside if share price rises |
|---|---|---|
| SAYE | None -- take cash back | Buy at fixed discount price |
| SIP (partnership shares) | Value falls with shares held | Tax-free growth if held 5 years |
Illustrative only -- specific scheme terms vary by employer. Use the compound interest calculator to model regular savings growth.
Side-by-Side Comparison
| Factor | SAYE | SIP |
|---|---|---|
| Capital risk | None | Yes, once shares held |
| Free shares possible | No | Yes, up to GBP 3,600/year |
| Contribution source | Post-tax savings | Pre-tax salary |
| Term | 3 or 5 years | 5-year tax-free holding period |
| Best for | Risk-averse savers | Maximising employer match/free shares |