Pension Tax Relief Calculator 2026/27
Tax relief on your 2026/27 pension contribution: effective rate, what you pay from take-home, basic-rate relief added at source, the higher-rate relief to claim, NI saved by salary sacrifice, the £60,000 annual allowance and taper check and the cost of each £1 saved.
| Your marginal tax rate | — |
|---|---|
| What you actually pay from take-home | — |
| Basic-rate relief added automatically | — |
| Higher / additional-rate relief to claim | — |
| National Insurance saved | — |
| Total tax relief | — |
| Effective cost of £1 in your pension | — |
| Annual allowance check | — |
| Personal allowance / child benefit effect | — |
| Maximum relievable contribution this year | — |
In short
UK pension contributions get tax relief at your marginal rate — 20%, 40% or 45%, and effectively 60% between £100,000 and £125,140 where the personal allowance is tapered — on contributions up to your earnings and the £60,000 annual allowance (tapered to £10,000 for adjusted incomes over £260,000). Relief-at-source schemes add 20% automatically; higher-rate taxpayers must claim the rest through Self Assessment. Salary sacrifice also saves 8% / 2% employee NI.
Who this is for: UK employees and the self-employed deciding how much to pay into a pension and claiming higher-rate relief.
How pension tax relief works in 2026/27
| Taxpayer | Relief on £100 in the pension | You pay |
|---|---|---|
| Basic rate (20%) | £20 | £80 |
| Higher rate (40%) | £40 | £60 |
| £100,000–£125,140 (PA taper) | £60 | £40 |
| Additional rate (45%) | £45 | £55 |
| Salary sacrifice, basic rate | £28 (20% tax + 8% NI) | £72 |
- Annual allowance: £60,000 (or 100% of earnings if lower) including employer contributions, tapered by £1 for every £2 of adjusted income over £260,000 down to £10,000 (only if threshold income exceeds £200,000). Unused allowance from the previous three years can be carried forward.
- Claiming: higher-rate relief in relief-at-source schemes is not automatic — claim via Self Assessment or ask HMRC to adjust your tax code; you can go back four years.
- Sweet spots: the 60% zone between £100,000 and £125,140, the child benefit charge zone £60,000–£80,000, and bonuses sacrificed into the pension.
- At the other end: 25% of withdrawals is tax-free (up to £268,275), the rest taxed as income — so relief at 40% now and tax at 20% later is the classic win.
See also: UK Take-Home Pay Calculator 2026/27.
Assumptions
- Relief = income tax on gross income − income tax on gross income less the contribution (rUK bands, personal allowance taper).
- Relief at source: 20% added by the provider, remainder claimed; net pay and salary sacrifice give relief through payroll; sacrifice also saves employee NI.
- Annual allowance £60,000 tapered £1 per £2 of adjusted income over £260,000 (floor £10,000) when threshold income exceeds £200,000; carry forward added.
Worked example
A £70,000 earner is a higher-rate taxpayer; £10,000 into the pension reduces income tax by £4,000 (40% relief). The provider adds £2,000 basic-rate relief, so you pay £8,000 and reclaim £2,000 through Self Assessment — net cost £6,000, or 60p per £1 saved. No NI saving unless you use salary sacrifice (which would save another £200 at 2% above £50,270 and some at 8%). £13,000 of the £60,000 annual allowance is used, leaving £47,000.
Frequently asked questions
How much tax relief do I get on pension contributions?
Relief at your marginal rate — 20%, 40% or 45% (up to 60% between £100,000 and £125,140 because of the personal allowance taper) — on contributions up to your earnings and the £60,000 annual allowance.
Do I need to claim higher-rate pension tax relief?
Yes, if your scheme uses relief at source (SIPPs, personal pensions, many workplace schemes): the provider adds 20%, and you claim the extra 20% or 25% through Self Assessment or your tax code.
What is the pension annual allowance for 2026/27?
£60,000 including employer contributions, tapered to as little as £10,000 for adjusted incomes over £260,000; £10,000 (MPAA) once you have flexibly drawn a pension.
Can I carry forward unused allowance?
Yes — unused annual allowance from the three previous tax years can be added, provided you were a member of a pension scheme in those years and have the earnings to support the contribution.
Can I claim relief for previous years?
Yes — higher-rate relief can be claimed for the previous four tax years by writing to HMRC or amending returns.
Do I get relief if I do not pay tax?
Non-taxpayers can still pay £2,880 a year into a relief-at-source pension and receive £720 of basic-rate relief (£3,600 gross).
People also ask
How much tax relief do I get on pension contributions?
20% at source for everyone (an £80 contribution becomes £100), with higher and additional-rate taxpayers claiming another 20% or 25% through self-assessment.
What is the pension annual allowance?
£60,000 a year including employer contributions, tapered down to £10,000 for adjusted incomes over £260,000; unused allowance can be carried forward three years.
Can I contribute more than I earn?
Tax relief is limited to 100% of relevant UK earnings (or £3,600 gross if lower); employer contributions are not limited by your earnings.
Is there still a lifetime allowance?
No — abolished from April 2024; a lump-sum allowance of £268,275 limits tax-free cash instead.
How do I claim higher-rate relief?
Through the self-assessment return or by asking HMRC to adjust your tax code; it is not automatic for relief-at-source schemes.
Does salary sacrifice give more relief?
It saves National Insurance as well as income tax — see the salary sacrifice pension calculator.
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