Pension sweet spot calculator

The best pension contribution is rarely a round percentage. It is the one that lands your income exactly on a threshold. On £110,000 the next pound you earn is taxed at 62.0%, so sacrificing £10,000 to get back under £100,000 costs you only £3,800 of take-home pay. That is the highest effective relief available anywhere in the UK system.

Your salary

Where you live

On £110,000, the next pound you earn is taxed at

62.0%

You are inside the allowance taper. Between £100,000 and £125,140 every extra pound is taxed at the higher rate and withdraws 50p of allowance that then gets taxed too. That is why a pound into a pension is worth so much more here than anywhere else.

The contributions worth making

Each lands your income exactly on a threshold. Click one to price it.

Or set it yourself: sacrifice £0 a year

Into your pension: £0
Take-home given up: £0
Cost per £100 saved: —

Salary sacrifice and relief at source are not the same thing

The figures above assume salary sacrifice, where the contribution never counts as salary. It escapes income tax and National Insurance, and it lowers the income the £100,000 taper is measured against.

Relief at source works differently and is often described wrongly. The contribution comes out of pay that has already had both tax and National Insurance taken, your provider claims 20% back, and a higher-rate taxpayer has to claim the rest through Self Assessment. It saves no National Insurance at all. On £40,000 with a 10% contribution our engine gives identical National Insurance with relief at source and with no pension at all, while sacrifice saves £320.00. Anywhere you see a private plan credited with an NI saving, the sum is wrong.

Your employer has to agree sacrifice in advance and it cannot be applied to pay you have already received. It also lowers the salary used for mortgage applications and some statutory payments. The salary sacrifice guide covers what else it touches, and the pension relief calculator works out what a higher-rate taxpayer must claim back.

Ignores the annual allowance, which caps total contributions and is itself tapered for very high earners, and assumes you keep enough pay to stay above the National Minimum Wage, which sacrifice cannot take you below. Rates from HMRC for 2026/27, checked 2026-08-28.

Why 62.0% and not 60%

This number is quoted wrongly almost everywhere, so it is worth setting out. Between £100,000 and £125,140 your personal allowance is withdrawn by £1 for every £2 you earn. Each extra pound is taxed at the higher rate of 40%, and it also exposes 50p that used to be tax free, which is taxed at 40% as well. That is 60p of income tax on every extra pound, so 60% income tax. Add 2% National Insurance and the true marginal rate is 62.0%, not 60%, and not the 45% some calculators use because they have confused this band with the additional rate that starts at £125,140. In Scotland the same trap is worse still, because £100,000 falls inside the 45% advanced band.

Salary sacrifice saves National Insurance. Relief at source does not

These are three genuinely different arrangements and they produce three different take-home figures from the same contribution. Salary sacrifice comes out before both income tax and National Insurance, so it saves both and lowers the income the taper is measured against. A net pay arrangement comes out before tax but National Insurance is still charged on the full amount. Relief at source comes out of pay that has already had both taken: your provider claims 20% back and a higher rate taxpayer has to claim the rest through Self Assessment. It saves no National Insurance whatsoever. Any calculator crediting a private plan with an NI saving has made an arithmetic error, and it is a common one. Compare all three side by side.

The limits this ignores

There is an annual allowance capping the total that can go in each year across every scheme, including your employer's contributions, and it is itself reduced for very high earners. Unused allowance from earlier years can sometimes be carried forward. Salary sacrifice also cannot take your pay below the National Minimum Wage, your employer has to agree it in advance, and it cannot be applied to pay you have already received. Those rules change often enough that we do not publish figures for them here rather than risk publishing stale ones: check the current allowance on gov.uk, and take advice before making a large contribution.

Figures checked 2026-08-28 by Hadi against HMRC rates for 2026/27. An estimate, not financial advice. Method on the about page.