How to Claim Higher and Additional Rate Pension Tax Relief

Putting money into your pension is one of the most tax-efficient things you can do. But if you’re earning over £50,270, there’s a good chance you’re not getting all the tax relief you’re entitled to. In fact, higher earners in the UK miss out on hundreds of millions in unclaimed pension tax relief every year.

This article will walk you through how pension tax relief works, who can claim extra, and exactly how to do it – whether you’re employed, self-employed, or contributing through Penfold.

What Is Pension Tax Relief?

When you pay into a pension, the government gives you back the income tax you paid on that money in the form of tax relief up to the annual pension allowance of £60,000 (or 100% of your total earnings). It’s their way of encouraging you to save for retirement.

If you’re a basic-rate taxpayer (20%), your pension provider will automatically claim this back for you. That means:

• You pay £80 into your pension
• The government adds £20
• You get £100 in your pension pot

That’s a 25% boost on your money from HMRC, and you didn’t have to lift a finger.

But if you pay higher-rate (40%) or additional-rate (45%) tax? You’re entitled to even more tax relief — and you have to claim it yourself. Keep reading to find out how.

What is Higher and Additional Rate Pension Tax Relief?

If you pay income tax at 40% or 45% (or 42% and 47% in Scotland), you could be missing out on hundreds or even thousands in unclaimed pension tax relief. Most people know about the 20% tax top-up you get on pension contributions. But if you’re in a higher tax bracket, you’re entitled to even more – you just have to claim it yourself.

Tax relief on pensions works by giving you back the tax you paid on money you put away for the future. The higher your tax rate, the more you can reclaim.

Here’s the bottom line:

• Higher-rate taxpayers (40%) can claim up to 40% total relief on their pension contributions. This means £10,000 of pension contributions could cost as little as £6,000.
• Additional-rate taxpayers (45%) can claim up to 45% total relief. This means £10,000 of pension contributions could cost as little as £5,500.
• In Scotland, the rates are slightly different: 42% and 47% for higher and top-rate taxpayers.

Only 20% is added automatically. The rest? That’s yours to claim – or lose.

Am I Eligible to Claim?

• You can claim extra tax relief if:
• You earn over £50,270 (or the Scottish equivalents)

You've made personal or employee pension contributions into a relief at source pension (like Penfold, Nest, or a SIPP)

Not sure if your pension uses relief at source? Scroll down to "What if I have a workplace pension?"

How Much Could I Get Back?

Let’s break it down with an example – Sam earns £53,000 wants to pay £5,000 to her pension:

• She will automatically get 20% relief – £1,000 will be added by her provider. That’s because 20% of £5,000 (£1,000) comes from tax relief.
• Her income over the higher-rate threshold (£50,270) is £2,730.
• She can claim 20% extra relief on that £2,730 = £546 back.
• Add this to the £1,000 basic rate of relief and Sam’s total tax relief equals £1,546.
• So £5,000 in her pension pot only costs her £3,454.
• If she earned £55,270 or more, she'd be eligible for the full 40% relief on her entire contribution (£2,000 tax relief) – £5,000 in her pension costs only £3,000. Now that’s tax magic.

Rule of thumb: You can claim extra relief on pension contributions up to the amount of income you pay higher or additional rate tax on. On the other hand, if your pension contribution is more than the amount you earn above the higher rate tax band, only part of your contribution will eligible for higher rate tax relief.

How to Claim Higher or Additional Rate Relief

As of February 2025, HMRC has introduced an online service to streamline the process of claiming higher-rate and additional-rate tax relief. This replaces the need to write to HMRC, making the process faster and easier.

You now have two main ways to claim – via the new HMRC online tool or through your Self Assessment tax return.

Self Assessment Tax Return

If you complete a Self Assessment tax return, you must claim through your tax return (for the current tax year and any previous years). Use this service if you are claiming a tax relief through your tax code for just the current tax year.

• In your Self Assessment tax return
• Go to the "Tax Reliefs" section
• Enter your total gross pension contributions (the amount you paid + the basic 20% tax relief your provider added)

If you haven’t completed a tax return before, you can register and complete your tax return here.

If your self assessment is 12 months past the deadline you can write to HMRC using our Tax Relief Reclaim Letter Template.

HMRC’s New Online Claim Tool

As of 2025, there's a faster option for those who don’t file a tax return. Higher-rate and additional-rate taxpayers can now claim tax relief via HMRC’s online service. To be eligible, you must be paying into a personal or workplace pension scheme and be paying more than the basic rate of tax.

To claim tax relief using HMRC's online service, you'll need:

• Your National Insurance number
• The type of pension
• The name of your pension provider
• The net amount of pension contributions for each tax year
• Proof of payments from your pension provider
• Your payroll number or reference number

How to Claim: Sign in with your Government Gateway user ID and password (or create one if you don’t have an account). Fill in the required pension contribution details. Submit your claim (you can save progress and return to it later).

What Happens After I Claim?

Here’s the good news: the extra tax relief you claim doesn’t have to go into your pension. HMRC gives you a few options for how you receive it — it’s your choice. You could get it as:

• A tax rebate (HMRC sends you money back)
• A reduction in your tax bill (your tax return shows you owe less)
• A change to your tax code, so you pay less tax in future months

No matter how it’s paid, it’s money back in your hands — just for putting money into your pension. We call that a win-win.

What if I Missed a Year?

Made pension contributions in previous years but didn’t claim the higher-rate or additional-rate tax relief? All is not lost. You can backdate pension contributions for up to the last 4 tax years. That means for the 2025/26 tax year, you can still claim for:

• 2021/22
• 2022/23
• 2023/24
• 2024/25

Claiming tax relief on pension contributions for previous years works in the same way as claiming for this tax year – you can do this via either of the methods outlined above.

Remember, you’ll only be able to claim for years in which you were a higher earner (earned over £50,270).

What If I Have a Workplace Pension?

Thankfully, because most pension contributions from a workplace pension are deducted before tax, you should automatically receive tax relief at your highest rate. You won’t have to actively claim it yourself.

However, some workplace pension schemes are set up in a way where pension contributions are taken after tax.

If you're not sure if you're receiving tax relief, check with your employer or pension provider which contribution arrangement your workplace pension uses: net pay, relief at source or salary sacrifice and whether your pension provider adds higher or additional rate tax relief automatically. If not, you may be able to claim money back if:

• you pay higher or additional rate Income Tax
• you pay higher or top rate Income Tax in Scotland

How Does Workplace Pension Tax Relief Work?

Relief at Source, if you're a higher/additional rate taxpayer, you'll need to claim the rest yourself (as above): Here, your employer deducts your pension contribution after tax and National Insurance have been taken from your pay. Your pension provider then adds tax relief to your pension pot at the basic tax rate, irrespective of your total earnings.

Net Pay Arrangement, no action needed: Your pension contributions are taken before tax. You get full relief immediately whether you are a basic, higher, or additional rate taxpayer.

Salary Sacrifice, no action needed: Your pension contributions are entirely paid by your employer and not subject to income tax. This arrangement means you have agreed to reduce part of your salary in exchange for a pension contribution made by your employer. Without salary sacrifice, this part of your salary would have been subjected to income tax and National Insurance. Instead, your employer contributes this amount to your pension, free of these taxes.

Claim It. Keep It. Grow Your Pension.

If you’re earning above the basic tax rate, pension tax relief isn’t just a perk – it’s a powerful, often-missed opportunity to boost your retirement savings and lower your tax bill today.

The new HMRC tools have made it easier than ever to claim what you’re owed. And if you’re with Penfold, we’ve already taken care of the basics – your contribution records are ready and waiting, so you can claim the extra with confidence.

Whether you’re owed £50 or £5,000, don’t let that relief go unclaimed.

Log in, check your contributions, and make the claim. Future-you will thank you – and present-you might get a nice little rebate too.