Pension Impact Calculator
See exactly how a pension contribution percentage affects your monthly take-home pay. Compare contribution methods (salary sacrifice vs net pay vs relief at source), see the effective tax relief, and find the cost per £100 going to your pension.
Pension inputs
| Item | Without contribution | With contribution |
|---|---|---|
| Gross salary | — | — |
| Income Tax | — | — |
| National Insurance | — | — |
| Pension contribution (cash) | — | — |
| Net take-home (annual) | — | — |
| Tax relief saved | — | |
| Net cost per £100 to pension | — | |
The three UK pension contribution methods compared
UK workplace pensions use three different methods to handle contributions and tax relief:
| Method | Tax relief | NI savings | Best for |
|---|---|---|---|
| Salary sacrifice | All bands automatic | Yes (8% basic, 2% higher) | Most workers — best tax efficiency |
| Net pay arrangement | All bands automatic | No | Many large employer schemes |
| Relief at source | Basic auto; higher via SA | No | Personal pensions, some workplace |
The NI saving is the differentiator. For a basic-rate taxpayer, salary sacrifice saves 28% per £100 contributed (20% IT + 8% NI). Net pay saves 20%. Relief at source saves 20% automatically; higher-rate workers need to claim the extra 20% via Self Assessment (often missed).
How tax relief stacks by band
| Income range | Combined Income Tax + NI | Take-home cost per £100 to pension |
|---|---|---|
| Under £12,570 (no tax) | 0% + 0% = 0% | £100 (only NI relief if sacrifice) |
| £12,571–£50,270 (basic) | 20% + 8% = 28% | £72 |
| £50,271–£100,000 (higher) | 40% + 2% = 42% | £58 |
| £100,001–£125,140 (taper) | 60% + 2% = 62% | £38 |
| £125,140+ (additional) | 45% + 2% = 47% | £53 |
These figures assume salary sacrifice (best case). Net-pay and relief-at-source give the Income Tax portion only — slightly worse outcomes.
The annual allowance
For 2026/27: £60,000 standard annual contribution limit including employer + your + sacrificed amounts. Tapered annual allowance applies if total income exceeds £260,000 — reduces by £1 for every £2 of income above £260,000, to a minimum of £10,000 at £360,000+. Carry-forward of unused allowance from the previous 3 tax years is permitted.
FAQs
How much tax relief do I get on UK pension contributions?
Relief depends on your marginal rate and contribution method. Basic-rate workers get 20% relief automatically; higher-rate get 40% (top 20% via Self Assessment for relief-at-source schemes). Additional-rate get 45%. Salary sacrifice also skips NI.
What's the difference between sacrifice and personal contributions?
Sacrifice contributions come from gross pay before Income Tax AND NI. Personal contributions (relief at source) come from net pay; government tops up basic-rate relief; higher/additional-rate workers claim extra via Self Assessment.
How much should I contribute?
Auto-enrolment minimum: 8% total (5% you + 3% employer). Common rule of thumb: your age ÷ 2 as percentage (e.g. age 30 → 15%). Right number depends on retirement target + current pot + circumstances. The calculator shows take-home impact of any %.
What's the 2026/27 annual allowance?
£60,000 standard. Tapers to £10,000 minimum if total income exceeds £260,000.
Can I claim higher-rate relief myself?
Yes via Self Assessment. Salary sacrifice gives it automatically. Relief-at-source schemes give basic-rate auto; you claim extra via SA. Many higher-rate earners don't claim — leaving thousands unrecovered each year.
Related calculators
- Salary Sacrifice Calculator — tax + NI saved at any rate
- Take-Home Pay Calculator — full PAYE breakdown
- Pension projection — long-term pot projection
- Bonus Tax Calculator — sacrifice bonus into pension
- Student Loan Calculator — SL alongside pension
Related guides
- Pension impact calculator guide — full guide
- Higher-rate pension tax relief — claim what you're owed
- Should I increase contributions? — decision framework