How much can self-employed people pay into a pension?

Annual allowance for self-employed pensions

Your annual allowance for the 2025/2026 tax year is capped at ^{_annual_allowance}. This includes personal contributions and any employer contributions, if applicable (e.g. through your limited company). It also includes any tax relief received. It’s also important to note that personal contributions can’t exceed your annual earnings.

The annual allowance reduces if your income exceeds ^{_adjusted_income} a year, reducing by £1 for every £2 over ^{_adjusted_income}. Once your income reaches £360,000, your allowance is just ^{_money_purchase_annual_allowance}.

Is there tax relief on self-employed pension contributions?

Yes, self-employed pensions are eligible for tax relief. If you’re self-employed and pay into a private pension, your pension provider should automatically claim basic rate tax relief from the government and add it to your pot. This is called ‘relief at source’. Usually basic rate taxpayers get a ^{_corporation_tax} tax top up; meaning HMRC adds £25 for every £100 you pay into your pension making it ^{_lower_earnings_limit}.This reduces the cost of your contributions.

If you’re a higher or additional rate taxpayer, however, you’ll need to claim the extra tax relief through your Self-Assessment.

You can also use the ‘carry-forward’ rule to increase your contribution limit. This allows you to use unused annual allowance from the previous three tax years. This is up to £180,000 if you didn’t contribute in 2022/2023, 2023/2024, and 2024/2025 - provided you have sufficient earnings in the current year and were a member of a registered pension scheme during each year you want to carry forward.

If you’re self-employed and are the director of a limited company, you can make employer contributions via your company. This means your pension payments could be treated as an allowable business expense. This can allow you to offset your pension contributions against corporation tax. Find out more about contributions from a limited company.

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What are the minimum and maximum pension contribution limits for self-employed people?

Minimum contributions

There’s no legal minimum contribution required to start a personal pension. However, some pension providers may set their own minimums (e.g. £20–£100 per month or a lump sum of ^{_higher_rate_personal_savings_allowance}–^{_basic_rate_personal_savings_allowance}) to open an account. So, it’s worth checking with the pension provider.

If you’re a PensionBee customer, there are no minimum contribution amounts. You can contribute flexibly, as much as you like, as often as you like. You can contribute regularly or make one-off payments as and when you can. Find out more about PensionBee’s self-employed pension.

Maximum contributions

There’s no maximum contribution on self-employed pensions, but there’s a limit on how much tax relief you can get. This makes payments above the threshold less tax efficient.

You can receive pension tax relief on any personal contributions that you make, up to 10^{_personal_allowance_rate} of your salary. There’s also a separate limit on the sum of all contributions (personal contributions including tax relief, and employer contributions) that you can make in a tax year capped at ^{_annual_allowance} gross for (^{_current_tax_year_yyyy_yy}). Any contributions that you make over this limit are taxed at your highest rate - this is known as the annual allowance tax charge.

Another thing to consider is the Money Purchase Annual Allowance (MPAA). This is a reduced limit on pension contributions that applies if you start withdrawing from your pension. You can access your pension money from age 55 (rising to 57 from 2028). The MPAA applies to all defined contribution pensions - which most modern day personal and self-employed pensions are. When the MPAA is triggered, your annual allowance is reduced to ^{_money_purchase_annual_allowance} per year (^{_current_tax_year_yyyy_yy}).

Strategies for maximising your pension contributions as a self-employed person

Set up regular contributions

Rather than being automatically enrolled into a workplace pension, as a self-employed person you need to set up your own pension contributions. You can choose to set up regular monthly payments to make things easier. If your income varies, you can adjust these up or down depending on your earnings each month.

Make ad hoc contributions where possible

Alongside your regular contributions, consider topping up your pension with lump sum payments when you can. For example during better months or windfalls (e.g. new contracts or bonuses).

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Check your unused annual allowance

Remember, you can carry over any unused allowance from the three previous tax years. The amount of pension annual allowance you can carry forward will depend on how much you used in the previous three tax years. The table below shows the annual allowance for the current tax year and previous three tax years. You can check whether you have any unused annual allowances at GOV.UK.

You can check whether you have any unused annual allowances at GOV.UK.

Avoid triggering the MPAA

Once you start accessing your pension money (from 55, rising to 57 from 2028), the MPAA will be triggered. This lowers your annual allowance from ^{_annual_allowance} down to ^{_money_purchase_annual_allowance} (^{_current_tax_year_yyyy_yy}).

Supplement with a Lifetime ISA (LISA)

Alongside your self-employed pension, you might also be eligible to save into a Lifetime ISA (LISA). You can contribute up to ^{_adjusted_income_on_annual_allowance} annually into your LISA, and the government will add a ^{_corporation_tax} bonus which is capped at ^{_basic_rate_personal_savings_allowance} (^{_current_tax_year_yyyy_yy}). LISAs are available to UK residents aged between 18 and 39 and can be used to buy a first property or for retirement.

Consolidate your old pensions

If you have any pensions from previous jobs, it might be worth combining them. These could be other self-employed or private pensions or old workplace pensions. Consolidating your pensions into one pot has many benefits. Firstly, it can help you keep track of your total retirement savings and simplify your pension management. Combining could even save you money on management fees you’re paying across multiple providers.

Seek professional advice

As a self-employed person, your tax matters might be more complex than someone in regular employment. An Independent Financial Adviser (IFA) can help you explore ways to maximise your tax efficiency and your contributions into your pension. Just make sure they’re regulated using the Financial Conduct Authority’s (FCA) register.

Risk warning

As always with investments, your capital is at risk. The value of your investment can go down as well as up, and you may get back less than you invest. This information should not be regarded as financial advice.

Last edited: 21-10-2025