Pension Tax Claim

Can I Claim Higher and Additional Rate Pension Tax Relief?

Are you earning over £50,270 and contributing to a pension? You could be owed money from the taxman. Find out how below.

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Am I Eligible For Higher Rate Tax Relief?


You can claim extra higher-rate and additional-rate pension tax relief if:


  • You earn over £50,270, and
  • You have made personal or employee contributions to a ‘relief at source’ pension scheme (such as Nest or any other SIPP provider).

This can boost your contributions by a substantial 25%! You can claim this relief either as a cash refund or as a reduction in your tax bill through your Self Assessment tax return.



Higher-rate and additional-rate pension tax relief is extra relief available to those earning over £50,270 on their personal pension contributions. This is on top of the 25% basic-rate tax relief everyone gets when they contribute to their pension.


Higher-rate Taxpayers


  • Higher-rate taxpayers can claim up to 40% in pension tax relief, meaning £10,000 in contributions could effectively cost only £6,000.


Additional-Rate Taxpayers


  •  Additional-rate taxpayers can claim up to 45% in pension tax relief, reducing the cost of £10,000 in contributions to just £5,500.


Many people miss out on this extra relief, with an estimated £830 million unclaimed each year. This is because, unlike basic-rate tax relief, you need to claim higher-rate and additional-rate tax relief yourself.


There’s another great benefit: this extra tax relief doesn’t have to go into your pension. You can use it to:


  • Reduce your annual tax bill
  • Adjust your tax code to lower your next year’s tax bill
  • Get a tax rebate

How does higher-rate pension tax relief work?


Basic-Rate Income Tax Relief


Basic-rate income tax relief is granted to every taxpayer on their personal pension contributions, capped at the annual allowance of £60,000 or 100% of total earnings, resulting in a 25% increase in contributions.


Higher-Rate Income Tax Relief


For higher-rate taxpayers, an additional 20% tax relief is available on contributions, totaling 40% tax relief, in line with the 40% tax rate paid on earnings surpassing the higher-rate income tax threshold.


This supplementary relief operates similarly to basic-rate relief, effectively adding another 25% to contributions. Here’s a breakdown:


  • •  Deposit £1,000 into your pension, and the government adds £250.


  • •  You can then claim an additional £250 through your Self Assessment tax return or by contacting HMRC.


Factors Affecting Extra Tax Relief


The amount of extra tax relief depends on:


  • • Your earnings


  • • Your contribution amount


Specifically, you can seek 20% extra tax relief on earnings above £50,270 taxed at 40%, or 25% extra tax relief on earnings taxed at 45%.

How many years back can I claim pension tax relief?


Current legislation in the UK allows you to claim a tax rebate for up to four tax years. This means that at the current moment, you can make a claim for the periods:


  • Year ending 5th April 2021
  • Year ending 5th April 2022
  • Year ending 5th April 2023
  • Year ending 5th April 2024


pension tax relief graph

Are you owed Tax back from HMRC? Find out today