Pensions: What are the options?

PensionsCopy link

Pensions are one of the first tools most people reach for to reduce their tax bill or lower their adjusted net income.
Pension contributions are tax free up to £60,000 per year (or 100% of your earnings if lower). This means that for a higher rate taxpayer, every £1 contributed to a pension saves 40p in tax. For an additional rate taxpayer, every £1 contributed to a pension saves 45p in tax. However, at higher incomes, this tax-free amount tapers off.
The amount contributed can be rolled over from the previous 3 years if it was not fully used.

Workplace PensionsCopy link

If you are employed, your employer may offer a workplace pension scheme. These often come with employer contributions which can significantly boost your retirement savings.
Contributions to workplace pensions are typically made through salary sacrifice, which means your gross salary is reduced by the amount you contribute. This can lower your taxable income and National Insurance contributions.
Employers may also match your contributions up to a certain percentage, effectively providing free money towards your retirement. They may also contribute the National Insurance amount that has been saved.
Using up unused allowance from the previous 3 years can further benefit your total worth by maximising employer contributions of saved National Insurance.

Use the calculator below to estimate how much headroom you have before you hit the £60,000 annual allowance (including carry-forward and any employer NI pass-through opportunities).