Pension Tax Relief Calculator
Calculate how much tax relief you get on pension contributions as a basic, higher or additional rate taxpayer.
Last updated: April 2026 · Source: GOV.UK
Disclaimer
This calculator is provided for informational purposes only and should not be considered as financial or tax advice. All calculations are performed locally in your browser — no personal data is collected or sent to our servers. Rates and thresholds are sourced from HMRC and GOV.UK and are updated for the current tax year. Always verify results with HMRC or consult a qualified professional before making financial decisions.
How It Works
Pension tax relief restores income tax paid on contributions. Under relief at source (used by most personal pensions), you contribute from net pay and the provider claims 20% basic rate relief from HMRC automatically. A £80 net contribution becomes £100 gross in your pension. Higher-rate (40%) and additional-rate (45%) taxpayers claim the extra relief through self-assessment: on a £100 gross contribution, a 40% taxpayer gets £40 total relief (£20 automatic + £20 via tax return).
Net pay arrangements (used by many workplace schemes) deduct contributions before calculating income tax, so full relief is given immediately regardless of tax rate. A £100 gross contribution costs a basic-rate taxpayer £80, a higher-rate taxpayer £60, and an additional-rate taxpayer £55. Scottish taxpayers use Scottish income tax rates (19/20/21/42/45/48%) which alter the relief calculation.
Total contributions from all sources must stay within the annual allowance of £60,000 (or 100% of earnings if lower) to avoid a tax charge. The annual allowance charge claws back the tax relief on excess contributions at your marginal rate. Contributions exceeding £60,000 are added to taxable income. Carry forward of unused allowance from the previous three years can shelter larger one-off contributions.
Tax relief on £500/month pension contribution for a 40% taxpayer
- Net monthly contribution: £500 (£6,000/year)
- Basic rate relief added automatically (20%): £500 / 0.80 = £625 gross per month (£7,500/year)
- Extra higher-rate relief via self-assessment: £7,500 x 20% = £1,500/year tax rebate
- Total tax relief: £1,500 (basic rate at source) + £1,500 (higher rate via SA) = £3,000
- Effective cost of £7,500 gross contribution: only £4,500 after all tax relief
Source: GOV.UK
Frequently Asked Questions
- What does the Pension Tax Relief Calculator do?
- Calculate how much tax relief you get on pension contributions as a basic, higher or additional rate taxpayer. All calculations are performed in your browser using official UK rates and thresholds.
- Are these figures guaranteed?
- No. Pension projections are estimates based on assumed growth rates and current contribution levels. Actual returns depend on investment performance, fees and future policy changes.
- What is the pension annual allowance?
- The pension annual allowance for 2025/26 is £60,000. This is the maximum you can contribute (including employer contributions) and receive tax relief. The allowance is tapered for high earners.