Calculate pension tax relief
What is pension tax relief?
To incentivise you to save for your retirement, the government tops up any pension contributions you make in the form of tax relief.
This means that some of the money that you would have paid in tax on your earnings goes into your pension rather than to the government.
Our short video explains how pension tax relief works:
How much pension tax relief can I get in 2025-26?
The level of tax relief you get is based on the highest rate of income tax you pay, but even if you don't work or pay tax you'll get tax relief on your pension contributions.
If you are a basic-rate (20%) taxpayer you only need to pay £80 from your salary into your pension to boost it by £100.
That's because the government adds £20 - this is what it would have taken in tax from £100 of your salary.
Higher-rate (40%) and additional-rate (45%) taxpayers only need to pay £60 and £55 respectively to boost their pension by £100.
Here are the different levels of pension tax relief you could get if you live in England, Wales or Northern Ireland:
| Rate of income tax | Rate of pension tax relief | |
| Non-taxpayers | 0% | 20% |
| Basic-rate taxpayers | 20% | 20% |
| Higher-rate taxpayers | 40% | 40% |
| Additional-rate taxpayers | 45% | 45% |
In Scotland, different income tax bands and rates apply. If you're a starter-rate (19%) taxpayer, you'll still get tax relief on your pension contributions at a rate of 20%.
| Rate of income tax | Rate of pension tax relief | |
| Starter-rate taxpayers | 19% | 20% |
| Basic-rate taxpayers | 20% | 20% |
| Intermediate-rate taxpayers | 21% | 21% |
| Higher-rate taxpayers | 42% | 42% |
| Advanced-rate taxpayers | 45% | 45% |
| Top-rate taxpayers | 48% | 48% |
- Find out more: UK income tax bands and rates explained
Is there a limit on the amount of pension tax relief I can get?
Yes, the government puts a limit on the amount you can save across all your pensions while still benefiting from tax relief. This is called the pensions annual allowance.
It currently stands at £60,000 a year, or 100% of your earnings - whichever is lower. This limit includes tax relief and employer contributions.
Any pension contributions you make over the £60,000 limit will be subject to income tax at the highest rate you pay.
However, you can carry forward unused allowances from the previous three years, as long as you were a member of a pension scheme during those years.
Pension tax relief calculations
The amount of tax relief you get on your pension contributions depends on the top rate of income tax you pay. The more tax you pay, the more valuable tax relief will be to you.
The worked examples below show how much it'll cost you to get a total pension contribution of £10,000, £40,000 or £100,000, depending on what rate of tax you pay.
| Basic-rate taxpayer (20%) | Higher-rate taxpayer (40%) | Additional-rate taxpayer (45%) | ||||
| Total contribution | Amount of tax relief | Cost to you | Amount of tax relief* | Cost to you | Amount of tax relief* | Cost to you |
| £10,000 | £2,000 | £8,000 | £4,000 | £6,000 | £4,500 | £5,500 |
| £40,000 | £8,000 | £32,000 | £16,000 | £24,000 | £18,000 | £22,000 |
| £100,000 | n/a** | n/a | £40,000 | £60,000 | £45,000 | £55,000 |
*You must pay sufficient tax at the higher or top rate to claim the full higher (40%) or top (45%) rate tax relief. **Tax relief is paid on pension contributions up to a limit of £60,000 a year. A basic-rate taxpayer would need to contribute more than £60,000 to get a total contribution of £100,000.
How do I claim pension tax relief?
The way you get tax relief - and whether this happens automatically or not - depends on the type of pension you are saving into, and the rate of income tax you pay. There are two systems: relief at source and net pay.
Pension tax relief from 'net pay'
If your pension scheme uses the 'net pay' arrangement, pension contributions are deducted from your salary before income tax is paid on them.
Your pension scheme automatically claims back tax relief at your highest rate of income tax, so you don't need to do anything to get the full tax relief you're entitled to.
Pension tax relief at source
With relief at source, your pension contributions are made from your after-tax pay.
If you're paying into a pension through your employer, your employer will take 80% of your pension contribution from your salary.
The pension provider then sends a request to HMRC, which pays 20% of the amount you've contributed into your pension.
If you’re entitled to more than 20%, you need to claim it yourself, either via your tax return or by contacting HMRC directly.
The relief at source system applies to some workplace pensions and all personal pensions - ie those you set up yourself, not via an employer, including self-invested personal pensions (Sipps).
Pension tax relief for non-taxpayers and low earners
Non-taxpayers, including spouses who aren't in employment and children, are eligible for tax relief of 20%.
Remember, you can save 100% of your income into a pension and get tax relief on this, as long as it doesn't exceed £60,000 in a year.
So, if you earned £5,000 a year, you could save £5,000 into a pension and get tax relief on all of this.
But if you earn £3,600 or less, including people that don't earn any money, the maximum you can contribute is £3,600. This includes tax relief, so your personal contribution can be no higher than £2,880.