Calculator · 2026/27
Pension tax relief calculator
Relief is given at your marginal rate, not the basic rate — so the same contribution costs very different amounts depending on where your income sits. In the £100,001–£125,140 band it is worth most of all.
Your result
What £5,000 into a pension costs, by income
| Income | Marginal rate | Take-home given up | Into the pot | Cost per £1 |
|---|---|---|---|---|
| £30,000 | 28% | £3,600 | £5,000 | £0.72 |
| £50,000 | 28% | £3,600 | £5,000 | £0.72 |
| £60,000 | 42% | £2,900 | £5,000 | £0.58 |
| £110,000 | 62% | £1,900 | £5,000 | £0.38 |
| £130,000 | 47% | £2,629 | £5,000 | £0.53 |
The last column is the real price of pension saving: how much spending power you give up for each £1 that reaches the pot. Lower is better, and it is lowest exactly where the marginal rate is highest.
Why the £100,000 row is different in kind
Everywhere else on that table, relief is simply your marginal rate. Between £100,001 and £125,140 a contribution does a second job as well: the personal allowance taper is measured on income after pension contributions, so contributing reduces the income being tapered and gives you back allowance you were losing. The contribution is relieved at 62% rather than 40%, and that is not a quirk to exploit — it is how the rule is written. The full arithmetic →
Two ways of contributing, and they are not equivalent
Salary sacrifice reduces your contractual pay, so income tax and both sides of National Insurance fall. A personal contribution from net pay gets income tax relief — basic rate reclaimed by the provider, higher and additional rate claimed through Self Assessment — but no National Insurance saving at all, because the salary never changed. For the same money into the pot, sacrifice costs you less. Compare them →
The limits
The annual allowance caps total pension input each year and tapers for high earners; exceeding it creates a charge that can undo the whole saving. This is arithmetic on rates, not advice — pension decisions turn on your age, your other savings and when you need the money, and none of those is something a calculator can weigh.
Where £60,000 sits in the system
Every calculator on this site runs on the same thresholds, and the reason a figure surprises people is almost always that it sits near one of them. This is what is closest to the worked example above — the thresholds that decide what the next pound is worth, rather than what the last one was.
Everything that changes near £60,000 is behind it. The most recent was the higher rate, at £50,271, which you passed £9,729 ago.
| What changes | At | From here | |
|---|---|---|---|
| Higher rate | £50,271 | −£9,729 | passed |
| National Insurance upper earnings limit | £50,270 | −£9,730 | passed |
Measured against the 2026/27 parameters for England, Wales & Northern Ireland. Distances are on gross pay before any salary sacrifice, because that is the figure every one of these thresholds is tested against.
- £50,271 — Crossing it does not re-tax what you already earn — only the pounds above it move to the higher rate, which is the single most misunderstood thing about UK income tax.
- £50,270 — You are already past it, so your National Insurance is running at 2% rather than 8% on further pay — the higher rate above costs six points less than the raw band difference implies.
What a ten per cent move would do
A swing of ten per cent either way from £60,000 does not cross a single band: the rate on further pay stays at 42% across the whole range from £54,000 to £66,000. That makes this an unusually predictable place to be paid, and it means the arithmetic below scales — a rise of any size in that range is worth the same proportion in your hand.
| If pay moved | Gross | Take-home | Change | Next £100 taxed at |
|---|---|---|---|---|
| −10% | £54,000 | £41,877.40 | −£3,480 | 42% |
| −5% | £57,000 | £43,617.40 | −£1,740 | 42% |
| +5% | £63,000 | £47,097.40 | +£1,740 | 42% |
| +10% | £66,000 | £48,837.40 | +£3,480 | 42% |
And what a pension contribution would buy
There is no threshold within reach below £60,000, so a pension contribution here is not about ducking under anything — it is simply the ordinary trade. Sacrificing £3,000 costs you £1,740 in take-home, because 42% of it was never going to reach you anyway, and puts the full £3,000 into the pot. That is £3,000 of saving for £1,740 of spending power — a ratio of 1.72 to one, and it is the same ratio for every pound until the next band.
Student loans on the same figure
A student loan is not a tax and it is not in any headline rate, but it leaves the same pay packet on the same day — so it belongs in any figure used to make a decision. This is what each plan takes at the worked example above.
Every one of the five repayment thresholds is behind this salary, so whichever plan you are on, you are repaying. Which plan you are on is not a choice, and the difference between them at this salary is £18.45 a year, so it is worth knowing which one your payslip is deducting.
| Plan | Starts at | Repaid a year | A month | Your next £100 |
|---|---|---|---|---|
| Postgraduate Loan | £21,000 | £2,340 | £195 | 48% |
| Plan 5 | £25,000 | £3,150 | £262.50 | 51% |
| Plan 1 | £26,900 | £2,979 | £248.25 | 51% |
| Plan 2 | £29,385 | £2,755.35 | £229.61 | 51% |
| Plan 4 (Scotland) | £33,795 | £2,358.45 | £196.54 | 51% |
A postgraduate loan is repaid alongside an undergraduate one rather than instead of it, so someone with both pays both.
One engine behind all eleven
Every calculator on this site runs the same tax engine, and the engine file your browser downloads is byte-identical to the one that generated these pages — a test asserts it, because two implementations of a tax rule is one too many. So the figures here cannot disagree with the salary tables, the hourly pages or any other calculator: they are the same arithmetic asked a different question. The method page sets out how the bands are discovered rather than typed, and sources lists every parameter with the government page and the date it was read from.
Questions people actually ask
How much tax relief do I get on pension contributions?
Relief at your marginal rate. At £60,000 that is 42%, so £5,000 into the pot costs £2,900 of take-home. At £110,000 the same £5,000 costs only £1,900.
Do I have to claim higher-rate pension relief myself?
With salary sacrifice, no — the relief is automatic because the pay was never taxed. With a personal contribution, the provider reclaims basic rate and you claim the rest through Self Assessment. Higher-rate relief going unclaimed on personal contributions is common and is worth checking.
What is the pension annual allowance?
The cap on total pension input in a year, counting your contributions and your employer's. It tapers down for high earners, and unused allowance can often be carried forward from the previous three years. Going over creates a tax charge, so it is worth checking before making a large one-off contribution.
What this calculation assumes
- 2026/27 rates for England, Wales & Northern Ireland.
- One employment, paid through payroll, taxed on the standard code with no adjustments carried in.
- Employment income only — no dividends, savings interest, rental or self-employment income.
- No taxable benefits in kind, no company car, no unpaid leave.
- National Insurance category A: the standard case for an employee over 21 and under State Pension age.
- Income Tax is annual, but National Insurance is charged per pay period — a large one-off bonus can pay more NI than this annual view shows.
- No student or postgraduate loan repayment.
- No salary sacrifice and no workplace pension contribution.