HM Revenue and Customs (HMRC) has confirmed that tax relief on individual pension contributions stops when a pensioner reaches the age of 75, affecting older state pensioners across the UK.
Under HMRC rules, once a pensioner turns 75, the Government no longer adds basic-rate tax relief to their individual pension contributions. While it remains possible to pay into some pensions beyond this age, many pension schemes do not accept new contributions after this point because of the loss of tax relief.
Tax relief rules before age 75
Before reaching their 75th birthday, pensioners can receive tax relief on private pension contributions worth up to 100% of their annual earnings. This is usually done automatically, although in some cases individuals may have to claim it themselves, depending on the type of pension scheme and the rate of Income Tax they pay.
An annual allowance limits the amount that can be paid into a pension scheme each year before Income Tax must be paid. In 2026/27, the maximum amount is £60,000 per year. However, this only applies to UK residents under the age of 75, so if someone is still working on their 75th birthday, the Government does not add basic-rate tax relief on any pension contributions made from that point onwards.
Impact on contributions and death benefits
So while contributions can still be made after age 75, if the provider accepts them, the right to receive tax relief on these contributions is lost. Confirming the rule in its guidance on pensions tax, HMRC said: "Although contributions can be paid after a member has reached the age of 75, they are not relievable pension contributions and cannot qualify for tax relief."
Turning 75 also has an impact on pension death benefits. If a pensioner dies after this age, beneficiaries will have to pay Income Tax on these benefits at their marginal rate. If death occurs before 75, these benefits are typically free from Income Tax. This can significantly affect how much money is left to family from a pension.
Expert view on pension changes at 75
Oliver Griffin from Fidelity UK explained the implications of pension rule changes once reaching 75: "Once you turn 75, you no longer receive tax relief on personal pension contributions. For that reason, many pension schemes don't accept new contributions after this. If you happen to be working at 75, your employer can still pay into your pension - provided these contributions meet tax rules."
Griffin added: "Age 75 is also important for death benefits. If someone dies under the age of 75, their beneficiaries do not, at the moment, generally have to pay income tax or inheritance tax (IHT) on inherited pension wealth. If someone dies aged 75 or over, beneficiaries normally pay income tax on money they receive from the pension but, currently, they do not usually pay IHT on that. However, from April 6, 2027, unused pension funds and certain death benefits will be included in the deceased's estate for IHT purposes."
He also noted: "Once you turn 75, you should still be able to take your pension's tax-free cash, however the rules can become more complicated and potentially less favourable. Some pension providers may not allow you to take tax-free cash after 75."
