Glossary · UK

What is Higher Rate Pension Relief?

Higher and additional rate taxpayers can reclaim an extra 20% or 25% pension tax relief via Self Assessment.

Full Definition

When a pension contribution is made to a relief-at-source scheme, the provider automatically claims basic rate (20%) relief from HMRC, grossing up the contribution. Higher rate taxpayers (40%) can claim an additional 20% through their Self Assessment return, and additional rate taxpayers (45%) can claim an extra 25%. For 2026/27 the pension Annual Allowance is £60,000 (or 100% of earnings if lower). The claim is made on the SA100 tax return under the pensions section. Salary sacrifice arrangements give relief at source without the need to claim separately, making them particularly tax-efficient for higher earners who also save on National Insurance.