UK Pension Tax Relief Calculator
Net contributions are grossed up by 25% (basic rate at source). Higher and additional rate payers reclaim more via self-assessment.
UK pension contributions get tax relief at your marginal rate. Relief at source: provider grosses up by 20% automatically. Net pay: deduction before PAYE applied. Salary sacrifice: avoids both income tax AND NI.
Worked examples
£800 net contribution → £1,000 in pension (basic rate uplift).
Higher rate (£800 net, basic uplift £200, plus £200 reclaim): pension £1,000, true cost £600.
Salary sacrifice £1,000 gross for higher rate: pension £1,000; net pay falls only £580.
Sources:
HMRC Pensions
· retrieved 2026-05-14.
Frequently asked questions
Why does basic-rate relief happen automatically?
Pension providers operate 'relief at source' — they claim back basic rate from HMRC and add it to your pot. Higher-rate relief must be claimed via self-assessment.
How much can I contribute tax-relieved?
Up to 100% of UK earnings or £60,000 (whichever is lower) per tax year. Excess attracts annual allowance charge.
Carry forward?
Unused allowance from previous 3 years can carry forward, allowing one-off contributions up to £200k+. Speak to a qualified accountant or IFA.