Ndubuisi 'Andy' EgwimMoney Coach for Medics|Ex-NHS GP|21+ Yrs Investor| Founder, MoneyWiseDoctor.com|Helping Medics Avoid Big Money Mistakes

How to Get 40% Tax Relief on Your Pension

7 Oct 2025 · 1 min

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1:19

A short YouTube segment by Ndubuisi 'Andy' Egwim explaining how UK pension tax relief works for higher-rate (40%) taxpayers. He contrasts employer/NHS pension treatment (relief applied before salary) with Self-Invested Personal Pensions (SIPPs) where basic-rate relief (20%) is applied at source and higher-rate taxpayers must claim the additional relief via self-assessment. He gives a numeric example where a £20,000 pension contribution yields an extra £4,000 reclaimed via self-assessment and an overall tax-saving that reduced one listener's tax by about £13,000.

Chapters

The government is happy for you to put money in your pension and they will give you tax relief. That means if you're a 40% taxpayer and you put money in your pension, the government will give you 40% tax relief. Even your NHS pension, you already get the tax relief before you get your salary, so there's no tax on it. The money is going to your pension. If it's your SIP, the government turns around, that's HMRC, they say, oh, you put 20,000 in your, in your SIP. Sorry, because that 20,000 is money that's already been taxed. It's coming from your pocket. We didn't realize this was pension money. So take your 20% back or take your 40% back. And for those of you who are, who have been through the investment academy and you followed the steps and done it, I think someone saved about 13,000 pounds. She was falling into the 60% tax trap. So she did this increase her NHS pension, put money in her SIP, got 20% automatically in her SIP. So she put in like, let's say put in 20k and you get 20, that's 44, 000, £4,000, that's 20. And then she claimed the other 20 through self assessment because she's a higher rate taxpayer. So she got the other 4,000, so 8,000 as a whole and it dropped her taxable income and saved her as much as 13,000.