Pension Tax Relief Calculator 2026/27
See what a pension contribution really costs you after tax relief, and compare salary sacrifice, net pay and relief at source side by side.
2026/27 rates · verified 11 October 2026
| Method | Into pension | Take-home | Real cost to you |
|---|
Real cost is how much lower your take-home pay is than with no pension. Relief at source above 20% (higher rate, and the extra 1% for Scottish intermediate rate) is shown as if claimed through Self Assessment or your tax code.
The three ways pension contributions are taxed
Salary sacrifice
You agree to a lower salary and your employer pays the difference into your pension. You save Income Tax and National Insurance (and your employer saves 15% employer NI, which some pass on). It also lowers student loan repayments.
Net pay arrangement
Your employer takes the contribution from your pay before Income Tax, so you get full relief automatically. National Insurance is still charged on the full salary.
Relief at source
You pay from your take-home pay and the provider claims 20% basic rate relief from HMRC: £80 from you becomes £100 in your pension. Higher and additional rate taxpayers claim the extra through Self Assessment or a tax code change. Personal pensions and SIPPs always use relief at source.
Frequently asked questions
How much tax relief do I get on pension contributions?
Relief at your highest rate of Income Tax: 20% for basic rate taxpayers, 40% for higher rate and 45% for additional rate (19% to 48% in Scotland). With relief at source, your provider adds 20% and higher-rate taxpayers claim the rest through Self Assessment or their tax code.
What's the difference between salary sacrifice, net pay and relief at source?
Salary sacrifice: you give up salary and your employer pays it into your pension, saving Income Tax and National Insurance. Net pay: contributions come out before Income Tax, but not before National Insurance. Relief at source: you pay from taxed pay and the provider adds 20% tax relief.
How much can I pay into a pension?
You get tax relief on contributions up to 100% of your earnings, within the £60,000 annual allowance (which can be lower for very high earners or if you've already drawn a pension flexibly).
Can a pension get me out of the 60% tax trap?
Yes. Contributions reduce your adjusted net income, so paying enough into a pension to bring it back to £100,000 restores your Personal Allowance, giving relief at an effective 60%.
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All rates, thresholds and dates on this page come from official sources, including GOV.UK, HM Revenue and Customs, the Scottish Government, Revenue Scotland and the Welsh Government. Last verified 11 October 2026.