Pension Tax Relief Calculator UK 2025/26
Calculate how much tax relief you get on pension contributions. Compare salary sacrifice vs Relief at Source, check your Annual Allowance with carry forward, and see the effective cost of saving into your pension. UK tax year 2025/26.
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How to Use This Calculator
Tax Relief Check tab
Enter your annual salary and monthly pension contribution (as a fixed amount or percentage of salary). Select your contribution method — Relief at Source, Salary Sacrifice, or Net Pay. The calculator shows your gross contribution, the tax relief breakdown, total relief amount, and your effective cost. If you have triggered the MPAA, toggle that option under More Options to see the reduced allowance.
Salary Sacrifice vs Relief at Source tab
Enter your annual salary and the monthly contribution you want to make. The calculator provides a side-by-side comparison showing take-home pay impact, employer cost, pension pot contribution, NI savings, and the total benefit of salary sacrifice over Relief at Source. It assumes your employer passes on the employer NI saving into your pension pot.
Annual Allowance Check tab
Enter your total pension contributions for the year (your contributions + employer contributions + tax relief added by the provider) and your annual salary. The calculator checks whether you exceed the £60,000 Annual Allowance (or £10,000 MPAA if triggered). Under More Options, enter any unused allowance from the previous 3 years to use carry forward.
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The Formula
Pension tax relief works differently depending on the contribution method:
Gross contribution = Net payment ÷ (1 − 0.20)
Provider adds = Net payment × 0.20 ÷ 0.80
Extra SA claim (higher rate) = Gross × 20%
Extra SA claim (additional rate) = Gross × 25%
Net Pay:
Full relief at marginal rate through payroll
Tax saved = Contribution × Marginal rate
Salary Sacrifice:
Income tax saved = Contribution × Marginal rate
Employee NI saved = Contribution × 8%
Employer NI saved = Contribution × 15%
Total saving = Tax + Employee NI + Employer NI
Annual Allowance:
Standard AA = £60,000
MPAA = £10,000 (if flexibly accessed pension)
Tapered AA = £60,000 − (½ × (adjusted income − £260,000))
Minimum tapered AA = £10,000
Carry forward = unused AA from previous 3 tax years
Tax charge = Excess × Marginal tax rate
With Relief at Source, you pay from after-tax income and the provider reclaims basic rate (20%) from HMRC. Higher and additional rate taxpayers claim the difference via Self Assessment. With Net Pay, your contribution is deducted before tax is calculated, giving full relief immediately. With Salary Sacrifice, your gross salary is reduced and the employer pays the difference into your pension, saving income tax, employee NI (8%), and employer NI (15%).
Example
Example 1: Tax Relief Check — Higher rate taxpayer
James earns £55,000 and contributes £300/month via Relief at Source.
Tax relief breakdown
James pays £300/month but gets £375 in his pension. After claiming £75/month via Self Assessment, his effective cost is £225 for £375 in the pot.
Example 2: Salary Sacrifice vs Relief at Source
Sarah earns £55,000 (higher rate) and wants to contribute £400/month.
Relief at Source
Salary Sacrifice
Salary sacrifice saves Sarah £92/month compared to Relief at Source (after SA claim). However, the Relief at Source route puts £500 in the pot vs £460 with salary sacrifice. The best choice depends on whether you value lower cost or a larger pot.
Example 3: Annual Allowance Check
Tom earns £80,000 and his total pension contributions (personal + employer + tax relief) are £55,000 this year. He has £10,000 unused from 2024/25.
Tom is within his allowance. He could contribute up to £15,000 more this year before triggering a tax charge.