How much is the government adding to your pension?
Every pound you put into a pension gets topped up by the government through tax relief. Most people have no idea how much this is worth.
Total going into your pension every month
£250
You contribute £200 · Govt adds £50
Annual breakdown
Over 25 years (at 5% growth)
Without tax relief your pot would reach £114,545. With tax relief it reaches £143,181 — an extra £28,636 from the government top-up alone.
Illustrative only. Constant contributions, 5% compound growth.
Want to see how this pot grows over time?
Run a full projection →Basic rate: income under £50,270 · Higher rate: £50,270–£125,140 · Additional: above £125,140
How does pension tax relief actually work?
Relief at source
Most workplace and personal pensions use "relief at source". You pay from your take-home pay, but your provider claims basic-rate tax relief (20%) directly from HMRC and adds it to your pot. Higher-rate taxpayers claim the extra via Self Assessment.
Salary sacrifice
You give up part of your salary and it goes straight into your pension before tax and National Insurance is calculated. This means you save both income tax AND NI contributions — typically worth an extra 2–8% on top of normal relief.
Annual allowance
You can contribute up to £60,000 per year (or 100% of your earnings, whichever is lower) and still receive tax relief. Contributions above this are subject to a tax charge. The lifetime allowance was abolished in April 2024.