Tax-registered pension scheme

The government encourages you to save for your retirement by giving you tax relief on pension contributions. Tax relief works in different ways depending on how contributions are paid, and will either reduce your tax bill or increase your pension fund. If your employer takes the pension contributions before deducting tax you will only pay tax on the reduced amount, and therefore pay less tax. If you pay income tax on your earnings before you make your pension contributions the pension scheme can claim back tax from the government and put it into your retirement pot.

Information correct as of December 3, 2013

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