Let’s take a look at an example

Kate earns £30,000 gross a year. She contributes 5% (including tax relief) into her pension. So, Kate puts in £100 a month, and this is topped up by another £25 of tax relief from HM Revenue and Customs (HMRC). Her employer also pays 3% which is £75 per month. That means the total going into Kate’s pension pot each month is £200. Kate's total contribution is £125 per month.

How much tax relief you get depends on your salary, other income you may have and the pension contributions you make.

  •  If you are a standard rate tax payer, tax relief is 20%.
  • If you pay tax at a higher rate, you may be entitled to 40% or 45% tax relief on all or part of your pension contributions. 
  • Higher rate taxpayers can claim additional tax relief from HMRC through their tax return. 


The information shown is relevant to standard UK tax payers.

Different rates of tax may apply to Scottish and Welsh tax payers. The value of any tax relief depends on your individual circumstances. This information is based on our understanding of current taxation law and HMRC practice, which may change. The value of investments can fall as well as rise, and isn’t guaranteed. The value of your pension pot when you take benefits may be less than has been paid in.