Pension Tax Relief

Pension Tax Relief

Below is a example illustrating the effective use of pensions to achieve monetary growth for retirement planning. 

For example,
You want to contribute £8,000 into your pension.

The Government adds £2,000 (20% Tax Relief) to make a total investment of £10,000.

If your a higher or additional rate tax payer, you can claim back even more tax relief via self assessment.
Therefore, a £10,000 pension contribution costs higher rate taxpayers
(40% Tax Relief) as little as £6,000 & additional rate taxpayers (45% Tax Relief) as little as £5,500.

For high earners, the effective tax relief in some instances can be 60% and when contributions are paid via salary sacrifice the effective rate can be increased to nearly 67%!
Click on the different retirement categories to learn more about these:

Personal Pensions  –  Occupational Schemes  –  Annual Allowance  
Lifetime Allowance  –  Money Purchase Annual Allowance (MPPA) 
State Pension  –  Small Self Administered Schemes (SSAS) 

Want to talk about pensions?

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