Pension Tax Calculator
Pension contributions get tax relief at your marginal rate. If you're a basic-rate taxpayer (20%), a £100 pension contribution costs you £80 in take-home pay. Higher-rate (40%) taxpayers pay £60, and additional-rate (45%) taxpayers pay £55. This calculator shows the effective cost after relief and any employer National Insurance savings.
Calculate Pension Tax Relief
Disclaimer: This calculator is for guidance only. Always verify with HMRC or consult a qualified accountant for your specific situation.
How Pension Tax Relief Works
Automatic Relief at Source
Most workplace pensions use the relief at source method. The pension provider claims 20% tax relief from HMRC automatically. So if you contribute £80 from your net pay, HMRC adds £20, making it £100 in your pension pot.1
Higher and Additional Rate Relief
If you're a higher-rate (40%) or additional-rate (45%) taxpayer, you get extra relief through your tax return or PAYE code adjustment. For a £100 gross contribution, you get an additional £20 (higher-rate) or £25 (additional-rate) back.2
| Tax band | Relief rate | £100 contribution costs |
|---|---|---|
| Basic (20%) | 20% | £80 |
| Higher (40%) | 40% | £60 |
| Additional (45%) | 45% | £55 |
Annual Allowance
The annual allowance for 2026-27 is £60,000. This is the maximum you can contribute across all pensions in a tax year while still getting tax relief. If you earn over £200,000, the allowance tapers down to a minimum of £10,000.3
Read more: Pension contribution limits UK
Salary Sacrifice
Some employers offer salary sacrifice, where you give up part of your salary in exchange for a pension contribution. This saves both you and your employer National Insurance. For a £100 sacrifice, you save £8 NI (if you're a basic-rate employee), and your employer saves £13.8%, often passed on to your pension pot.
Self-Employed Relief
If you're self-employed, you make gross contributions and claim relief through your Self Assessment. The pension provider adds 20% automatically, and you claim any higher or additional rate relief on your tax return.
Related Guides
Sources
- HMRC, Tax relief on pension contributions, accessed 15 May 2026.
- HMRC, Pension schemes: claim tax relief, accessed 15 May 2026.
- HMRC, Pension schemes rates 2026-27, accessed 15 May 2026.