What's the government bonus? (tax relief)

When you save into your pension pot, you’ll get a massive 25% bonus from the government, added automatically.

We call this a bonus as it’s like free money from the government, which you’ll only get from saving into your pension.

It's technically called tax relief, and designed to refund you the tax you've paid on your income, to help you save more for retirement.

If you pay 40% (or 45%) tax on your income, you might be able to claim some of this back too (on a Self Assessment tax return).

So, the more of your savings you add to your pension pot, the bigger bonus you’ll get (more free money).

This also means your money can grow much larger over time, as the free money you get can grow over time too.

However, you won’t be able to withdraw your money until you’re 55 (57 from 2028). It’s intended to build a comfortable retirement for you.

Note: the government could change these tax rules in the future, and your overall tax treatment will depend on your individual circumstances.