Millions of people are missing out on extra money in their pension pots because they are unaware of a simple claim they can make to HMRC.
Statistics released last year show that Britons failed to claim £1.3billion between 2016 and 2021.
The current rules mean that those who get a 20 percent tax on their income get the relief on their pension automatically.
For those on the higher rate – 40 percent or 45 percent – only the rate at which 20 percent is applied is what they receive.
As a result, many who have not claimed are missing out on 20 to 25 percent of tax relief.
Those who are entitled to tax relief can apply for it by sending a Self Assessment return to HMRC. About 75 percent of top earners in the UK are eligible to claim for tax relief.
A HMRC spokesperson said: “Taxpayers who pay the higher rate of income tax can claim additional tax relief on their personal pension payments without submitting a tax return, by contacting us by phone (0300 200 3300) or in writing (Pay as You Earn and Self Assessment, HM Revenue and Customs, BX9 1AS).”
They add that Additional-rate taxpayers should use the Self-Assessment form to claim back what they are entitled to.
Pensioners can claim back contributions worth up to 100 percent of their annual earnings.
HMRC hands tax relief back to some people automatically.
