If you’re a higher or additional rate taxpayer in the UK, there’s a good chance you’re leaving free money on the table.
And we’re not talking pennies.
Each year, higher earners collectively miss out on hundreds of millions of pounds in unclaimed pension tax relief, simply because they didn’t know they could claim it.
But thanks to our partnership with PIE, it’s now easier than ever to make sure you get back what you’re owed.
What is pension tax relief? And who gets it?
When you pay into a personal pension like the InvestEngine SIPP, the government rewards you by topping up your contributions. This is called tax relief, and it’s one of the biggest benefits of pension saving. This can also be true if your workplace pension is a ‘relief at source’ pension, whereby your additional tax relief is also left unclaimed, meaning that you could be missing out on even more.
Here’s how it works:
If you pay income tax at 20% (basic rate), you don’t have to do anything. We automatically claim that relief on your behalf. If you invest £80, for example, you will get £20 added automatically to your account.
But if you’re a higher or additional rate taxpayers, who pay tax on income at 40% or 45%, you are entitled to claim up to 25% extra, depending on your income.
The catch? That extra relief isn’t added automatically. You need to claim it.
So, how much is going unclaimed?
A lot.
Recent research found that between 2016 and 2021, UK higher-rate and additional-rate taxpayers missed out on more than £1.3 billion in unclaimed pension tax relief.
- Over 7 million people are now in the higher-rate tax bracket
- More than 1.2 million are additional-rate taxpayers
- Around 46% of them don’t claim the full relief they’re owed
That’s millions of people potentially missing out on up to thousands, simply because the process is complex or confusing.
How InvestEngine and PIE are fixing it
We’ve teamed up with PIE, the all-in-one tax app, to make claiming your extra pension tax relief easier than ever.
If you’ve opened an InvestEngine Personal Pension (SIPP), here’s what happens:
- You pay into your pension
- We automatically claim your 20% basic rate relief
- And if you’re a higher or additional-rate taxpayer, you can use PIE to claim the rest online, in minutes
No forms. No phone calls. No HMRC login required.
Just log into your InvestEngine account, select your pension, and hit “Get additional tax relief.” PIE will guide you through the rest.
It’s completely free to do it yourself with Pie, and if you want a little help, there’s optional support available for a small fee.
See it in practice
Let’s say you’re earning £80,000 and contributing £500 a month into your pension. You’ll automatically get £125 added by HMRC (20% relief) but you’re actually entitled to £250 total (40% relief)
That’s an extra £125 every single month or £1,500 a year that you need to claim yourself. Over a 30–40 year career, this can easily add up to £40,000 or more in unclaimed tax relief.
You can check this for yourself using our new pension tax relief calculator!
If you’ve opened an InvestEngine SIPP and you’re a higher or additional-rate taxpayer, take two minutes to start your claim with PIE.
Or if you’re paying into other relief-at-source pensions like Nest, The People’s Pension, or similar workplace schemes, PIE can still help you claim your additional-rate tax relief there too.
Important information
Capital at risk. The value of your portfolio with InvestEngine can go down as well as up, and you may get back less than you invest.
Tax treatment depends on personal circumstances and may change. ETF costs apply. InvestEngine does not provide tax advice.