Tip clearance flow can have a large impact on compressor performance and is therefore important to consider in compressor design. A wide range of computational approaches can be used for modeling tip clearance flow. The different modeling strategies reflect compromises between accuracy and computational time. The present study investigates a large tip gap configuration (1.65% of the rotor tip chord) of the highly loaded transonic 1.5 stage compressor Hulda. The aim of the study is to evaluate different modeling approaches and find a method that can predict the effects of a large tip clearance on compressor performance. The modeling approaches investigated are the SAS-SST model in CFX and the k-ε turbulence model using a wall function and Chien’s low-Reynolds model in the in-house CFD solver VolSol++. Results obtained using the chosen solvers and turbulence models are compared with experimental data, and all approaches are shown to predict the overall performance trends. However, the turbulence kinetic energy in the tip clearance flow and the trajectory of the vortex are shown to vary depending on the method. The SAS-SST model predicts the performance well in terms of total pressure ratio, polytropic efficiency as well as radial distribution of total pressure downstream the rotor. Based on the results from the study, SAS-SST is concluded to be a good candidate for detailed studies of transonic compressors with large tip gaps.