UK Pension Calculator

Tax relief means money you pay into a pension comes out of your pay before Income Tax. With relief at source, you pay in from your take-home pay and your provider adds 20%; if you pay tax at a higher rate, you claim the rest back through Self Assessment or by asking HMRC to change your tax code. With a net pay arrangement, your employer takes the money from your pay before working out your tax, so you get relief at your top rate straight away. With salary sacrifice, you give up some salary and your employer pays it in instead, so you save National Insurance as well as tax.

For a basic rate taxpayer, £1 in the pension costs 80p of take-home pay, and for a higher rate taxpayer 60p. Salary sacrifice also saves National Insurance (8%, or 2% on pay above £50,270), so £1 can cost a basic rate taxpayer 72p. In Scotland, relief follows the Scottish rates: an extra 1% for intermediate rate taxpayers, and an extra 22%, 25% or 28% at the higher, advanced and top rates. The calculator works out your own figure from your salary, tax rates and how you pay.

Under automatic enrolment at least 8% of your qualifying earnings must go in, with at least 3% of that from your employer, so usually 5% from you including tax relief. That’s a legal minimum, not a target, and many people need more to keep their lifestyle in retirement. If your employer matches extra payments, it’s usually worth taking the full match, as it’s extra pay you’d otherwise miss. Try the “If you paid 1% more” figure to see what a small increase does over time.

Qualifying earnings are the slice of your pay between £6,240 and £50,270 a year in 2026/27. Many automatic enrolment schemes work out contributions on that slice only, so on a £35,000 salary they’re based on £28,760. Some employers use your whole salary instead, which means more goes in. You’re automatically enrolled once you earn over £10,000 a year with one employer, as long as you meet the age conditions.

You can usually take 25% of your pot tax-free, either as one lump sum or a bit at a time. The tax-free total is capped by the lump sum allowance: £268,275 across all your pensions, unless you have a protection. The rest is taxed as income when you take it. The calculator shows 25% of your projected pot, up to that allowance.

The calculator uses a rule of thumb: taking 4% of your pot each year, which has historically had a good chance of lasting around 30 years. It isn’t a guarantee: investments can fall, and you might live longer than you expect. You could instead buy an annuity, which pays a guaranteed income for life; rates vary, so the calculator doesn’t estimate one. The after-tax figure assumes a quarter of each withdrawal is tax-free and uses today’s tax bands.

You can usually take money from a workplace or personal pension from 55, rising to 57 on 6 April 2028. Some people have a protected pension age, and you may be able to take it earlier if you’re seriously ill. The State Pension is separate and starts at State Pension age: 66, rising to 67 between 2026 and 2028, and to 68 between 2044 and 2046 under current law. The calculator estimates yours from your age.

The full new State Pension is £241.30 a week (£12,547.60 a year) from 6 April 2026, up from £230.25. You usually need 35 qualifying years of National Insurance contributions or credits to get the full amount, and you can check your own forecast on GOV.UK. If you won’t get the full amount, untick the box and the calculator leaves it out. It assumes the State Pension keeps its value against inflation.

It’s the most that can go into your pensions each tax year before you pay an annual allowance charge: £60,000, counting your payments, your employer’s and tax relief. It tapers down, to as little as £10,000, if your adjusted income is over £260,000 and your threshold income is over £200,000. You can carry forward unused allowance from the last 3 tax years. Once you’ve flexibly accessed a pension, for example by taking more than your tax-free cash, a money purchase annual allowance of £10,000 applies instead, and carry forward can’t raise it.

A charge of 0.75% a year sounds small, but it’s taken from your whole pot every year, so over decades it can add up to tens of thousands of pounds; the growth figure is after charges. Prices also rise, so £1 in 30 years’ time will buy much less than £1 does now. The calculator divides future amounts by your inflation rate to show them in today’s money, which is what they’d buy now.

From 6 April 2029, salary sacrificed into a pension above £2,000 a year is due to pay National Insurance. It has been announced but isn’t in force, so the calculator doesn’t include it. From 6 April 2027, unused pension savings count towards your estate for Inheritance Tax. That is already law (Finance Act 2026) but doesn’t apply to a death before that date, so the calculator leaves it out; the Inheritance Tax calculator shows what it means.

It’s for defined contribution pensions, where you build up a pot. It doesn’t cover defined benefit (final salary or career average) schemes, annuity rates, or investment risk: real returns change from year to year and can be negative. It assumes your pay rise, contributions, growth, charges and inflation stay the same every year, and that tax bands, the qualifying earnings band and the State Pension keep pace with inflation. Treat the results as an illustration, not a forecast.