If your pension works by “relief at source”, only 20 per cent is added automatically — whatever rate of tax you actually pay. On a £10,000 gross contribution a higher-rate taxpayer is owed another £2,000, an additional-rate taxpayer £2,500, and someone caught in the £100,000 to £125,140 personal allowance taper £4,000. HMRC projects 7.7 million higher-rate and 1.29 million additional-rate taxpayers in 2026/27, and those of them in relief-at-source schemes get the extra only if they ask for it. Claims die four years after the end of the tax year, so anything from 2022/23 must reach HMRC by 5 April 2027.
This is not a scheme or a loophole. It is relief you are already entitled to in law, which the system does not hand over on its own.
The three ways relief is delivered
Everything turns on one fact about your pension. There are three delivery methods, and only one leaves money on the table.
Relief at source — the one that leaves money behind
GOV.UK states that you get relief at source in all personal and stakeholder pensions, and some workplace pensions. Your contribution comes out of pay that has already been taxed; the provider then claims 20 per cent from the government and adds it to your pot. Pay 80p, and 20p follows.
That 20 per cent is all you get automatically. If your marginal rate is 40 or 45 per cent — or in Scotland 21, 42, 45 or 48 — the balance sits with HMRC until you claim it. Nest, the government-backed auto-enrolment scheme, says so in its own member guide: if you pay a higher rate, “you’ll need to claim this yourself”.
Net pay arrangement — nothing to claim
Here your employer takes the contribution out of your pay before deducting Income Tax. HMRC’s Pensions Tax Manual puts it plainly: if the contribution is £100, £100 leaves your pay and £100 goes into the scheme, and because tax is worked out on what is left you have “effectively been given full tax relief” up front. A 40 per cent taxpayer gets 40 per cent immediately. Claiming again would be wrong.
Salary sacrifice — also nothing to claim
Under salary sacrifice you give up contractual pay and your employer pays the money into the pension instead. HMRC defines it as an agreement to reduce an employee’s entitlement to cash pay, usually in return for a non-cash benefit. Because the pay never exists, there is no relief to give and none to claim — and you save National Insurance too, which the other two methods do not. Our guide to salary sacrifice pensions covers the trade-offs.
The payslip test
Find gross pay, the pension deduction and taxable pay on a payslip. If taxable pay equals gross pay minus the pension deduction, it is net pay. If taxable pay is unreduced and the pension comes out after tax, it is relief at source and you may have a claim. If gross pay itself has been cut and the pension line shows only an employer contribution, that is salary sacrifice. If it is ambiguous, ask payroll. Our explainer on workplace pensions goes through the deductions.
Exactly what you can claim, at each rate
GOV.UK sets out the claim precisely. In England, Wales and Northern Ireland you can claim “20% up to the amount of any income you have paid 40% tax on” and “25% up to the amount of any income you have paid 45% tax on”. The second half of that sentence is the part people miss: the claim is capped by how much of your income actually sat in the higher band, not by the size of your contribution.
For 2026/27 the UK rates and thresholds are a Personal Allowance of £12,570, basic rate 20 per cent to £50,270, higher rate 40 per cent to £125,140 and additional rate 45 per cent above that. The Personal Allowance falls by £1 for every £2 of adjusted net income above £100,000 and is nil at £125,140.
| Situation (2026/27) | Gross into pension | Added at source | Extra you must claim | Total relief | Real cost to you |
|---|---|---|---|---|---|
| Basic rate, salary £35,000 | £4,000 | £800 | £0 | £800 (20%) | £3,200 |
| Higher rate, salary £60,000 | £6,000 | £1,200 | £1,200 | £2,400 (40%) | £3,600 |
| Higher rate, salary £55,000 (contribution exceeds the band) | £8,000 | £1,600 | £946 | £2,546 (31.8%) | £5,454 |
| Allowance taper, salary £110,000 | £10,000 | £2,000 | £4,000 | £6,000 (60%) | £4,000 |
| Additional rate, salary £150,000 | £10,000 | £2,000 | £2,500 | £4,500 (45%) | £5,500 |
| Scottish higher rate, salary £48,000 | £4,000 | £800 | £880 | £1,680 (42%) | £2,320 |
| Scottish intermediate rate, salary £40,000 | £2,000 | £400 | £20 | £420 (21%) | £1,580 |
The straightforward higher-rate case
Salary £60,000, and £400 a month into a personal pension. That is £4,800 of your own money; the provider adds £1,200 and the pot receives £6,000. Your income above £50,270 is £9,730, more than the contribution, so all of it qualifies. You claim 20 per cent of £6,000: £1,200. Net cost of £6,000 in the pension: £3,600.
When only part of the contribution qualifies
Salary £55,000, and a £6,400 payment that grosses up to £8,000. Only £4,730 of your income sat above £50,270, so only £4,730 of the contribution attracts the extra 20 per cent: £946. The remaining £3,270 already had its full 20 per cent at source. Claim 20 per cent of the whole £8,000 and you will be asking for £1,600 you are not owed. Total relief here is £2,546, an effective 31.8 per cent.
The £100,000 band, where relief is worth 60 per cent
Relief is worth more in this band than anywhere else in the rest-of-UK table, because the contribution buys back Personal Allowance as well as stretching the basic-rate band. Salary £110,000 means your Personal Allowance is cut by £5,000 to £7,570. Put £10,000 gross into a pension and adjusted net income drops to £100,000, restoring the whole £12,570.
Work the tax both ways. Without the contribution, taxable income is £102,430: £37,700 at 20 per cent is £7,540, and £64,730 at 40 per cent is £25,892, so £33,432 in all. With it, taxable income is £97,430 and the basic-rate band stretches to £47,700: £9,540 plus £49,730 at 40 per cent, which is £19,892, so £29,432. The bill falls by £4,000. Add the £2,000 already claimed at source and total relief is £6,000 on £10,000 — 60 per cent. You paid £8,000, you get £4,000 back, the pension holds £10,000. A Scottish taxpayer in the same band does better again: the advanced rate of 45 per cent plus the same allowance withdrawal makes relief worth 67.5 per cent.
Additional rate
Salary £150,000, £8,000 paid in, £10,000 in the pot. Income above £125,140 is £24,860, so the whole contribution sits in the 45 per cent band and you claim 25 per cent of £10,000: £2,500. Total relief £4,500, real cost £5,500. There is no allowance to restore; it was already nil.
Normalised to a £10,000 gross contribution, the extra relief is nil at basic rate, £2,000 at higher rate, £2,500 at additional rate, £4,000 inside the £100,000 to £125,140 taper, £100 at the Scottish intermediate rate and £2,200 at the Scottish higher rate. The taper figure assumes income of £110,000, so that the full £10,000 falls inside the taper band.
Scotland: the claim starts lower
Scotland sets its own rates on earned income, and this is one of the few places where that genuinely changes what you should do. For 2026/27 the Scottish bands, published in the same form by the Scottish Government, run 19 per cent from £12,571 to £16,537, 20 per cent to £29,526, 21 per cent to £43,662, 42 per cent to £75,000, 45 per cent to £125,140 and 48 per cent above that.
Relief at source still gives 20 per cent to everyone. GOV.UK confirms that “if your rate of Income Tax in Scotland is 19% your pension provider will claim tax relief for you at a rate of 20%” — a small windfall for starter-rate payers, who keep it. Above that, the claimable amounts are 1 per cent on income taxed at 21 per cent, 22 per cent at 42 per cent, 25 per cent at 45 per cent and 28 per cent at 48 per cent.
Two consequences. A Scottish taxpayer can have something to claim on around £30,000 of income, where someone in England has nothing until £50,270 — the 1 per cent intermediate claim is only £20 on a £2,000 contribution, but it is real and easily missed. And the Scottish 42 per cent rate starts at £43,663, so a Scot on £48,000 has a 22 per cent claim worth £880 on a £4,000 contribution while an identical earner in Cardiff has none. Wales and Northern Ireland use the UK rates throughout.
How to claim
If you file a Self Assessment return, put the figure in the pensions section. HMRC’s guidance is that if you complete a return “you must claim through your tax return (for the current tax year and any previous years)”. A return can only be amended for 12 months after its filing deadline, so for 2022/23 and 2023/24 that window has shut: those years now need a written overpayment relief claim to HMRC instead, which runs to the same four-year limit. Enter the gross figure — what you paid plus the 20 per cent the provider added. Entering the net figure is the most common error and it costs you a fifth of the claim. For 2025/26 the online return is due by 11:59pm on 31 January 2027.
If you do not file a return, use HMRC’s service for claiming tax relief on your private pension payments, online or by letter. You need your National Insurance number, the pension type and provider, the net contributions for each tax year claimed, your payroll reference, and evidence — usually an annual statement or payslips. The same route covers basic-rate taxpayers whose workplace scheme is not claiming relief for them, and lump sums paid into a scheme that is not net pay.
How the money reaches you
The extra relief is paid to you, not into the pension. As MoneyHelper explains, you get a refund after the tax year ends, a reduction in a tax bill you owe, or a change to your tax code. For regular contributions HMRC usually builds an allowance into the code, which carries an estimate that goes wrong when your contributions change; our guide to tax codes explains how to read one. If you want the money in the pension, pay it in yourself — our pension pot projector shows what that is worth over time.
Four years, and the 5 April cliff edge
The deadline is statutory. Section 43 of the Taxes Management Act 1970 says “no claim for relief in respect of income tax or capital gains tax may be made more than 4 years after the end of the year of assessment to which it relates”. Tax years end on 5 April, so claims fall off the edge on 5 April.
- 2022/23 — must be claimed by 5 April 2027. This is the one to deal with now.
- 2023/24 — by 5 April 2028.
- 2024/25 — by 5 April 2029.
- 2025/26 — by 5 April 2030.
2021/22 has already closed. If you have been a higher-rate taxpayer in a relief-at-source scheme for a decade and never claimed, you can recover four years, not ten. That is the honest answer, and it is why this is worth doing now rather than next spring.
Not sure whether you have a claim at all?
Two minutes with a payslip settles it: work out whether your pension is relief at source, then total four years of contributions before 5 April 2027.
Explore GetSmartSaver →The limits that cap all of this
Relief is available on contributions up to the greater of 100 per cent of your relevant UK earnings and a basic amount of £3,600 gross. HMRC’s manual on relief at source is explicit that where earnings are below £3,600, it is “the only method by which the member can get tax relief on the excess contribution”. So someone with no earnings can pay in £2,880 a year and have it grossed up to £3,600. Paying in more than you earn creates no relief to claim back.
The published rates for 2026/27 keep the annual allowance at £60,000, the money purchase annual allowance at £10,000, the minimum tapered annual allowance at £10,000, the threshold income limit at £200,000 and the adjusted income limit at £260,000. The allowance covers your contributions, your employer’s and any defined benefit build-up. The taper applies only when threshold income exceeds £200,000 and adjusted income exceeds £260,000 — both tests, not either.
The money purchase annual allowance is triggered by flexibly accessing a defined contribution pension. HMRC’s manual on the MPAA confirms it bites from the tax year of first flexible access onwards and that “any unused money purchase annual allowance cannot be carried forward to later tax years”. Taking taxable cash from a defined contribution pot through drawdown, or as an uncrystallised funds pension lump sum, can cut your allowance from £60,000 to £10,000 permanently; taking only the tax-free lump sum, or cashing in a pot of £10,000 or less under the small pots rule, does not. Carry forward is the useful bit: GOV.UK confirms you “might be able to carry over any annual allowance you did not use from the previous 3 tax years”, if you were a scheme member in those years. It does not lift the earnings limit.
The low-earner net pay anomaly
There is a mirror-image problem at the bottom of the income scale. Someone earning under the Personal Allowance in a relief-at-source scheme still gets 20 per cent added; someone in a net pay scheme gets nothing, because they had no tax to relieve. HMRC’s policy paper on relief relating to net pay arrangements describes low earners having “different levels of take-home pay depending on how their pension scheme is administered”, and estimates it affects around 1.2 million people, roughly 75 per cent of them women.
A top-up, now called the low earner’s pension payment, applies “from the 2024 to 2025 tax year onwards”, with eligibility assessed separately each year. It is not in anyone’s hands yet. HMRC’s pension schemes newsletter 184, August 2026 says payments for 2024/25 contributions “will begin in the coming months”, phased through the rest of the year and into early 2027. HMRC contacts eligible people directly, by post or through the personal tax account; employers and administrators do not apply on anyone’s behalf, and individuals do not need to contact HMRC.
Who this does not apply to
- Anyone in a net pay arrangement. Full relief was given in payroll, and HMRC bars relief twice on one contribution.
- Anyone using salary sacrifice. The pay was never yours, so there is no relief to reclaim.
- Basic-rate taxpayers in relief at source — 20 per cent was your full entitlement, unless the scheme was not claiming it for you.
- Non-taxpayers. You already got 20 per cent you never paid.
- Employer contributions. Made gross, never yours to claim relief on.
One caution about the headline. HMRC’s private pension statistics commentary of July 2026 estimates gross pension Income Tax and National Insurance relief of £83.9 billion in 2024/25, with 57 per cent of the relief on contributions given at the higher rate. What HMRC does not publish is any estimate of how much higher-rate relief goes unclaimed. Figures in the press putting it in the hundreds of millions come from commercial analyses, not from HMRC, and we are not repeating a number we cannot source. What is documented is the affected population — the 7.7 million higher-rate and 1.29 million additional-rate taxpayers projected for 2026/27 — and that for relief-at-source members the claim is not automatic.
What to do this week
- Find out which method your scheme uses. Payslip first, then payroll. Everything depends on this.
- If it is relief at source and you paid above the basic rate, total the gross contributions for each year from 2022/23, separately.
- Check how much income was actually in the higher band in each of those years. That figure, not the contribution, caps the claim.
- Claim through Self Assessment if you file one, otherwise through HMRC’s online service or by letter.
- Deal with 2022/23 before 5 April 2027, and read the tax code that follows — HMRC often builds ongoing relief into it on an estimate.
Frequently asked questions
How do I know if my pension uses relief at source?
Compare gross pay, the pension deduction and taxable pay on a payslip. If taxable pay equals gross pay minus the pension deduction, it is a net pay arrangement and there is nothing to claim. If the pension comes out after tax and taxable pay is unreduced, it is relief at source. GOV.UK says relief at source applies to all personal and stakeholder pensions and some workplace schemes.
How much extra pension tax relief can a higher-rate taxpayer claim?
Twenty per cent of the gross contribution, but only up to the amount of income you actually paid 40 per cent tax on. On a £6,000 gross contribution with £9,730 of income above £50,270, the claim is £1,200. If only £4,730 of income sat above the threshold, the claim is 20 per cent of £4,730, which is £946.
How far back can I claim pension tax relief?
Four years. Section 43 of the Taxes Management Act 1970 says no claim for relief may be made more than four years after the end of the year of assessment it relates to. In September 2026 that means 2022/23 onwards, and the 2022/23 claim must reach HMRC by 5 April 2027. The 2021/22 year has already closed.
Does the extra relief go into my pension?
No. It comes to you, as a refund, a reduction in a tax bill, or a change to your tax code so less tax is taken off future pay. Only the basic 20 per cent claimed by the provider lands in the pot. If you want the extra in the pension, pay it in yourself as a new contribution, which then attracts its own 20 per cent.
Is the claim different for Scottish taxpayers?
Yes. GOV.UK lists claims of 1 per cent on income taxed at 21 per cent, 22 per cent at 42 per cent, 25 per cent at 45 per cent and 28 per cent at 48 per cent. So a Scottish claim can start around £30,000 of income, well below the UK higher-rate threshold. Scottish starter-rate payers on 19 per cent still get 20 per cent at source and keep the difference.
Can I claim if I use salary sacrifice?
No. Under salary sacrifice you give up cash pay and your employer makes the contribution, so the money is never taxed as your income and there is no relief to reclaim. You save National Insurance instead. That saving is being capped: the National Insurance Contributions (Employer Pensions Contributions) Act 2026 received Royal Assent on 29 April 2026, and from 6 April 2029 pension contributions made by salary sacrifice above £2,000 a year will be treated as earnings for both employee and employer National Insurance. How the £2,000 limit will work in practice is still to be set out in secondary legislation. Income Tax relief on pension contributions is unchanged.
Last reviewed: September 2026. Figures are for the 2026/27 tax year (6 April 2026 to 5 April 2027) and come from GOV.UK, HMRC manuals and legislation.gov.uk current at the time of writing. Pension tax relief is UK-wide, but the rate you can claim depends on where you are resident for tax. Worked examples are our own calculations on the stated assumptions and ignore other income and reliefs. This article is general information, not personal financial advice — check your own position with gov.uk or HMRC, or get free help from MoneyHelper or Citizens Advice.
