Do I pay National Insurance on my pension contributions?

Do you get National Insurance relief on pension contributions just as you get tax relief?

Question asked by Ms A Li
Are You Pension Happy?
Call us on 02084327334
I know how much my pension is worth
I know how much my pension costs
I have clear financial goals for my retirement

Answered by Michael Englefield

Is NI payable on pension contributions?

Yes, you do have to pay National Insurance contributions on money going into your pension.

You rightly state that you don’t pay income tax on pension contributions, but National Insurance is still due on cash you put into your pension.

If you’re employed, your employer will deduct National Insurance contributions from your wages before you get paid, so before any tax or pension contributions have been deducted.


Your payslip will show the National Insurance contributions you’ve made over the year. If you earn above the £8,060 National Insurance threshold for the 2016/17 tax year, you pay 12% of your earnings. This rate drops to 2% on anything you earn above £43,000.

If you’re self-employed you pay Class 2 contributions of £2.80 a week for 2016/17 on all earnings above £5,965, plus Class 4 contributions of 9% of taxable profits between £8,060 and £43,00. On profits over £43,000, Class 4 contributions are 2% of profits. Again, these contributions are made from your profits before tax is deducted and any pension contributions have been made.

National Insurance contributions
Pensions and tax
Income tax
This information does not constitute financial or other professional advice. You should consult your professional adviser or contact us directly on 02084327333 should you require financial advice. It is important to ensure any insurance policy you take out is suitable for your needs.
Start your journey today...
  Find out how a Drewberry financial adviser can help you reach your destination by making the most of your finances.
Call us on 

Frequently Asked Pensions Advice Questions

What will happen to my pension when I die? Will it just stop or can I pass it on...
I’m in the middle of looking at retirement options and I’m not really sure I understand the...
I’ve recently found out how much I have in my pension think it might be sufficient but it is very...
I know that you have to pay income tax on your pension income, but will I also have to pay National Insurance...
Need Help? Live chat now and get an instant answer from our Experts...


Our Latest Reviews
Robert Eldridge

Rauri was easy to talk to. Explained everything really well. Took prompt action when requested and was in touch when he said he would be without being pushy.

Attila Mako

Excellent service. Oliver was very helpful and patient with me. He gave me knowledgeable advise describing the product details clearly. His communication was prompt and precise! Great customer service!

Ian Brett

Josh made a complicated process easy and I was kept informed throughout. I will be recommending Drewberry to every one who asks and even those who don't.

We are rated 4.9/5 based on 1512 independent client reviews.
To read more of our independent client reviews click here →
4.92 / 5 Average
1638 Reviews
D Gianfreda
Overall Rating
Friendly, efficient and professional service
T Bullock
Overall Rating
Friendly and professional
l kelham
Overall Rating
Excellent service, clear communication and advice
B Weller
Overall Rating
Very thorough service
E Portingale
Overall Rating
I had a short time to ensure I was covered appropriately due to change of circumstances and house move. I required a number of insurance policies for my new situation. I contacted Drewberry Insurance and found that they understood all of my needs and the best way to filter and sift appropriate insurers. They clearly understood the process...made everything very easy online and via telephone and always did as they said they would by actioning everything as and when requested. This took the time and confusion away from becoming insured. Their interaction and communication and explanation of all processes ensured I understood each stage of the process. Will recommend their services to anyone seeking insurance.