See how much tax relief you get on pension contributions in the 2026/27 tax year, and how much more you can claim back. Say you earn £60,000 in England and pay £4,000 into a personal pension. Your provider adds £1,000 (20%), so £5,000 goes in. As a higher rate taxpayer you claim another £1,000 through Self Assessment, so the total relief is £2,000 and the £5,000 pension saving really costs you £3,000. In Scotland the same contribution gets £2,100 of relief.
Pension Tax Relief Calculator 2026/27
Relief at source or net pay · UK and Scottish rates · Updated 13 October 2026
- Total going into your pension
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- Added by your provider (20%)
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- Extra relief to claim from HMRC
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- Tax saved through payroll
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- HMRC top-up after the tax year
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- Real cost to you
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- Relief as a share of the total
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- Your annual allowance
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- Annual allowance left
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2026/27 Income Tax rates and the standard £12,570 Personal Allowance. Pension contributions do not reduce National Insurance unless you use salary sacrifice. Other income, Gift Aid and Marriage Allowance are not included.
Relief at source and net pay: the two ways relief is given
- Relief at source is used by all personal and stakeholder pensions (including SIPPs) and some workplace schemes. You pay from your take-home pay, and the provider claims 20% from HMRC and adds it to your pot. Paying £80 puts £100 in. Higher, additional and some Scottish taxpayers must claim the rest themselves.
- Net pay is used by many workplace schemes. Your employer takes the contribution from your pay before working out Income Tax, so you get relief at your highest rate straight away. Nothing extra needs claiming. Through payroll you only get relief on income you would have paid tax on, so low earners and Scottish starter rate taxpayers get less; HMRC now tops up the difference after the tax year (see below).
- Salary sacrifice is different again: you give up salary and your employer pays the pension, which saves National Insurance as well. Our salary sacrifice calculator covers it.
How much relief you get in 2026/27
With relief at source, HMRC gives the extra relief by extending your basic rate band (and the other bands) by the gross contribution, so the same slice of income is taxed at a lower rate. For a typical taxpayer that works out as follows:
| Your top rate (2026/27 income) | Provider adds | Extra you claim | Total relief |
|---|---|---|---|
| Basic 20% (£12,571 to £50,270) | 20% | None | 20% |
| Higher 40% (£50,271 to £125,140) | 20% | 20% | 40% |
| Additional 45% (over £125,140) | 20% | 25% | 45% |
| Scottish band (2026/27 income) | Provider adds | Extra you claim | Total relief |
|---|---|---|---|
| Starter 19% (£12,571 to £16,537) | 20% | None (you keep the extra 1%) | 20% |
| Basic 20% (£16,538 to £29,526) | 20% | None | 20% |
| Intermediate 21% (£29,527 to £43,662) | 20% | 1% | 21% |
| Higher 42% (£43,663 to £75,000) | 20% | 22% | 42% |
| Advanced 45% (£75,001 to £125,140) | 20% | 25% | 45% |
| Top 48% (over £125,140) | 20% | 28% | 48% |
You only get the higher rate on the part of the contribution that matches income taxed at that rate. Someone earning £60,000 has £9,730 of income taxed at 40%, so a gross contribution of £15,000 gets extra relief on £9,730 only.
Worked examples
| Situation (2026/27) | Into pension | Total relief | Cost to you |
|---|---|---|---|
| Relief at source, earns £30,000, pays £2,400 | £3,000 | £600 | £2,400 |
| Relief at source, earns £60,000, pays £4,000 | £5,000 | £2,000 | £3,000 |
| Relief at source, earns £60,000, pays £12,000 | £15,000 | £4,946 | £10,054 |
| Relief at source, earns £110,000, pays £8,000 | £10,000 | £6,000 | £4,000 |
| Scotland, relief at source, earns £60,000, pays £4,000 | £5,000 | £2,100 | £2,900 |
| Scotland, relief at source, earns £35,000, pays £1,600 | £2,000 | £420 | £1,580 |
| Net pay, earns £40,000, £2,000 deducted | £2,000 | £400 | £1,600 |
| Net pay, earns £60,000, £5,000 deducted | £5,000 | £2,000 | £3,000 |
| Net pay, earns £12,000, £600 deducted | £600 | £120 (HMRC top-up) | £480 |
The £110,000 example gets 60% relief. A £10,000 gross contribution brings adjusted net income down to £100,000, which restores £5,000 of Personal Allowance that would otherwise be lost to the taper above £100,000.
Limits on tax relief
- 100% of your earnings. You get relief on personal contributions up to your relevant UK earnings for the year. If you earn less than £3,600, or nothing, you can still pay up to £2,880 into a relief at source pension and the provider adds £720, making £3,600.
- Annual allowance of £60,000. This covers everything paid in by you, your employer and anyone else. You may carry forward unused allowance from the previous 3 tax years.
- Tapered allowance. If your threshold income is over £200,000 and your adjusted income is over £260,000, the allowance falls by £1 for every £2 over £260,000, down to a minimum of £10,000.
- Money purchase annual allowance. If you have flexibly taken money from a defined contribution pension, a lower allowance applies to further money purchase saving.
How to claim the extra relief
If you are in a relief at source scheme and pay tax above 20% (or 21% in Scotland), the extra relief is not automatic. Put the gross amount paid in during the tax year on your Self Assessment return. If you do not file a return, you can claim from HMRC directly, for example by phone or letter, and the relief may be given through your tax code. Keep your provider's annual statement as evidence. For net pay and salary sacrifice schemes there is nothing to claim.
FAQs
Do pension contributions reduce National Insurance?
No, not under relief at source or net pay. National Insurance is worked out on your pay before pension contributions. Only salary sacrifice reduces National Insurance, because your salary itself goes down.
I earn under £12,570 and my workplace scheme uses net pay. Do I lose out?
Not any more, although you have to wait. Through payroll you get no relief because you pay no Income Tax, while a relief at source scheme would add 20% automatically. The law now requires HMRC to pay net pay savers the difference as a top-up as soon as practicable after the end of the tax year. It started for people with no taxable income from 2024/25, and from 14 July 2026 it was widened to anyone who gets less relief under net pay than relief at source would give, such as people whose income is only just above the Personal Allowance or who pay the 19% Scottish starter rate.
Does employer money get tax relief too?
Employer contributions go in gross and are not taxed as your pay, so there is nothing for you to claim. They do count towards your annual allowance.
Can pension contributions help with the High Income Child Benefit Charge?
Yes. Gross relief at source contributions and net pay contributions reduce your adjusted net income, which is the figure used for the child benefit charge and the £100,000 Personal Allowance taper.
Related calculators
- Salary Sacrifice CalculatorTax and NI saved by sacrificing salary
- Take-Home Pay Calculator 2026/27Your pay after tax, NI and pension
- High Income Child Benefit Charge CalculatorHow contributions cut the charge
Sources
- GOV.UK: Tax on your private pension contributions, tax relief · relief at source, net pay, Scottish rates
- GOV.UK: Annual allowance · £60,000
- GOV.UK: Work out your tapered annual allowance
- HMRC Pensions Tax Manual PTM044220: relief at source · £3,600 basic amount
- HMRC policy paper: Pensions relief relating to net pay arrangements · low earner top-up
- legislation.gov.uk: Finance Act 2004 section 193A · as amended by SI 2026/671 from 14 July 2026
- GOV.UK: Rates and thresholds for employers 2026 to 2027 · Income Tax bands
- gov.scot: Scottish Income Tax 2026 to 2027
Figures current as of 13 October 2026
Each formula is checked against a separate test sheet with at least three worked examples. Results are estimates based on the numbers you enter and the published rules; your actual figures may differ. This is general information, not financial or tax advice.
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