HMRC has become aware of abuse relating to claims for pension relief, with a third of claims for personal pension relief by higher rate taxpayers being incorrect, including numerous ineligible claims, mistaken calculations and some not even knowing how much they paid into their pension.

HMRC is tightening up checks to ensure personal pension relief claims are legitimate after a spot check found ‘many claims below the current evidence threshold were incorrect’. In future, all claimants will have to provide evidence of their claims.

From 1 September 2025, HMRC will lower the threshold for requiring evidence in support of new requests for higher rate or additional rate relief claims to be given through an individual’s tax code for the current year, and as a result, some individuals may be asked to provide evidence where it would not previously have been required.

HMRC has said that around 80,000 personal pension relief claims are received annually.

The total cost of pension tax relief was £29.5bn in the 2024-25 tax year.

This issue came to light after HMRC conducted a review to understand the level of risk in the sub £10,000 personal pension relief claims.

HMRC said that most taxpayers they wrote to did not respond with evidence, while of those who did, around one third needed to correct the amount claimed.

Going forward, individuals will have to submit claims online or by letter only.

If requested, you will need to send proof from your pension provider of payments made for each tax year you are claiming for.

So make sure you have the paperwork to justify any claim you intend to make for higher-rate tax relief on pension premiums.