Pension Calculator

Your gross salary is your total pay before tax and other deductions. This is the figure stated in your employment contract. For pension calculations, we use your full salary, though some schemes only count 'qualifying earnings' (currently £6,240 to £50,270). Check your pension documents or ask HR which earnings basis your scheme uses.

Under auto-enrolment, you must contribute at least 5% of qualifying earnings. However, you can usually contribute more - and it's often worth doing so if your employer matches contributions. Every £100 you contribute only costs you £80 (or £60 for higher-rate taxpayers) due to tax relief. Many experts recommend contributing at least 12-15% of salary (including employer contributions) for a comfortable retirement.

Your employer must contribute at least 3% under auto-enrolment. Many employers offer more generous schemes - some match your contributions up to a certain percentage (e.g., you put in 5%, they put in 5%). This is essentially free money, so always try to contribute enough to get the full employer match. Check your pension scheme booklet or ask HR about your employer's contribution structure.

Your marginal tax rate determines how much tax relief you get on pension contributions. Basic rate (20%): Income £12,571-£50,270. Higher rate (40%): Income £50,271-£125,140. Additional rate (45%): Income over £125,140. If you're a higher or additional rate taxpayer, you get even more benefit from pension contributions. Note: Scottish rates differ slightly - use the rate that applies to the bulk of your income.