Pension Contribution Calculator
Calculate UK workplace pension contributions. See employee and employer splits, qualifying earnings, and projected pension pot.
Minimum 5% for auto-enrolment (includes 1% tax relief)
Minimum 3% for auto-enrolment
Enter salary and rates to calculate pension contributions
Understanding UK Workplace Pensions
Auto-Enrolment Requirements
All UK employers must automatically enrol eligible workers into a workplace pension scheme. Eligible workers are those aged between 22 and state pension age, earning at least £10,000 per year, and working in the UK. Employers must make minimum contributions and cannot encourage employees to opt out. Workers who do opt out can be re-enrolled every three years.
Minimum Contribution Rates
The minimum total contribution is 8% of qualifying earnings, split between employer (minimum 3%) and employee (minimum 5%, which includes 1% from basic rate tax relief). Many employers choose to contribute more than the minimum. Contributions are calculated on qualifying earnings — the portion of salary between £6,240 and £50,270 for the 2025/26 tax year.
Qualifying Earnings Explained
Qualifying earnings are used to calculate minimum pension contributions. They include salary, overtime, bonus, commission, and statutory pay (such as SSP and SMP). Only the portion between the lower limit (£6,240) and upper limit (£50,270) counts. This means the first £6,240 of earnings is not subject to pension contributions, and earnings above £50,270 are also excluded from the minimum calculation.
Tax Relief on Pension Contributions
Employee pension contributions receive tax relief, effectively reducing the cost. For basic rate taxpayers (20%), a £100 contribution only costs £80 after tax relief. Higher rate taxpayers (40%) can claim additional relief through their tax return. The method of tax relief depends on the pension scheme type: relief at source or net pay arrangement.
Salary Sacrifice Pensions
Some employers offer salary sacrifice arrangements for pension contributions. The employee agrees to reduce their contractual salary, and the employer pays the saved amount into the pension. Both employer and employee save on National Insurance (15% and 8-2% respectively). The employee also saves on income tax. This can be significantly more tax-efficient than traditional contributions, though it reduces the salary used for mortgage applications and statutory pay calculations.
Pension FAQ
Can I opt out of my workplace pension?
Yes, you can opt out within one month of being enrolled and receive a full refund of any contributions. After one month, you can stop contributing but may not get a refund. Your employer must re-enrol you every three years. Opting out means you lose the free employer contributions and tax relief.
What happens to my pension if I change jobs?
Your pension pot stays invested with the existing scheme unless you choose to transfer it. You can transfer previous pensions to your new employer's scheme or to a personal pension. There is no obligation to transfer, and keeping multiple pension pots is perfectly fine. Compare charges and investment options before deciding.
Can I contribute more than the minimum?
Yes. You can increase your employee contributions at any time, and you will receive tax relief on the additional amount. The annual allowance for tax-relieved contributions is £60,000 (2025/26) or your annual earnings, whichever is lower. Ask your employer if they offer matching — many will increase their contribution if you increase yours.
When can I access my pension?
You can normally access your workplace pension from age 55 (rising to 57 from April 2028). You can take up to 25% as a tax-free lump sum. The remainder can be taken as drawdown income, used to buy an annuity, or a combination. Early access before age 55 is only possible in cases of serious ill health.
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