The government tops up your pension by adding basic rate tax relief of 20% to all your personal contributions (up to the maximum of 100% of your relevant UK earnings or £2,880 if this is greater).
If you pay tax at a rate higher than basic rate, you're entitled to extra tax relief on top of this.
You can claim this by either:
- contacting your local tax office and getting your tax code adjusted
- claiming the extra tax relief at the end of each tax year through self assessment
Do you want to get the extra tax relief throughout the year?
Contact your local tax office to tell them:
- the pension plan you’re making contributions into
- when you started making these contributions
- how much you contribute
If you don't know where your local tax office is, write to the address below, quoting your National Insurance number:
Pay As You Earn and Self Assessment, HM Revenue and Customs, BX9 1AS, United Kingdom
Or visit the HMRC income tax general enquiries page online for more information.
If you want to get the extra tax relief at the end of each tax year, you’ll need to fill in a self-assessment form or write to your local tax office to tell them.
On the form, you should give the gross personal contributions made (that’s your net personal contributions plus the 20% tax relief).
For example - net personal contributions £100 x 100/80 (basic rate of tax) = gross personal contribution of £125
You shouldn’t include employer contributions on the form but you should include any contributions made by a third party (other than your employer).
You’ll get this relief in the form of a tax rebate, a reduction in your tax liability, or an alteration to your future tax code.
If you’d like more information or want to discuss which of these methods is suitable for your own circumstances, you should get financial advice. You may have to pay a fee for this. If you don't have a financial adviser, you can visit moneyhelper.org.uk/choosing-a-financial-adviser to find the right one for you.
Important notes
- This information is based on our understanding of current taxation law and HM Revenue & Customs (HMRC) practice, which may change.
- The value of any tax relief will depend on individual circumstances.
- HMRC may ask for proof of the contributions you've made into your plan. We'll send you a yearly statement, which you should be able to use as proof. If your tax office needs any more evidence, please get in touch so we can help you.
- The information we've given here is a guide to the ways you can reclaim the additional tax relief you're entitled to if you pay income tax at higher than basic rate. It is relevant to schemes that use the relief at source method of collecting personal contributions (this is typically personal pensions). How you choose to receive that tax relief is entirely up to you.
- You can still fill in a self-assessment form or contact HMRC at the end of the tax year even if you've already had your tax code adjusted. You may need to do this if you've increased your payment level or made a number of one-off payments throughout the year, and your tax code hasn't been amended to take account of this.