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The Pension GapUnlike employed workers who benefit from auto-enrolment, self-employed people in the UK must arrange their own pension. Only 16% of self-employed workers are saving into a pension — a worrying statistic.Your OptionsPersonal Pension (SIPP): The most flexible optio...
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- Last Updated:
- 21 Apr 2026
- Category:
- Money Tips
- Reading Time:
- 1 min read
The Pension Gap
Unlike employed workers who benefit from auto-enrolment, self-employed people in the UK must arrange their own pension. Only 16% of self-employed workers are saving into a pension — a worrying statistic.
Your Options
- Personal Pension (SIPP): The most flexible option. You choose your investments and get tax relief at your marginal rate.
- Stakeholder Pension: A simpler, lower-cost option with capped charges.
- NEST: The government-backed scheme. Low fees but limited investment choices.
Tax Benefits
Every £80 you contribute is topped up to £100 by the government (basic rate relief). Higher-rate taxpayers can claim additional relief through their tax return.
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Remember, you can save up to £40k annually into your pension without incurring tax charges, but this includes employer contributions too. Useful for planning those larger lump sums.
I'm glad this article highlights the pension gap for self-employed people. However, could you clarify how NEST's fee structure compares to other options? I've heard they're not as low as initially marketed.
I'd add that if you're earning above £110K, watch your contributions as they may start to be taxed due to the pension contribution taper.