Can I save into a UK pension plan if I live abroad?
Many British expats wonder whether they can keep paying into a UK pension once they’ve moved overseas. The good news is yes, you can continue saving into a UK pension plan while living abroad — but there are rules, limits, and important tax relief restrictions you need to know about.
In this post, we will look at how the system works, what the 5-year rule means, and what happens if you return to the UK.
Can I Pay into a UK Pension While Living Overseas?
Yes. If you’re living abroad, you can still contribute to a UK pension scheme — such as a personal pension, SIPP (Self-Invested Personal Pension), or workplace pension you already had before leaving the UK.
However, the amount of tax relief you can get on those contributions depends on your circumstances.
How Much Can I Contribute?
If you don’t have any UK-taxed earnings, you can still contribute up to £3,600 per tax year into your UK pension and receive basic rate tax relief (20%).
That means:
- You pay in £2,880 from your pocket.
- The government tops it up with £720 in tax relief.
- Total contribution = £3,600.
This allowance applies for up to five full UK tax years after you move abroad.
👉 Example: If you moved to Spain in June 2024, you can keep contributing £3,600 per year (with tax relief) until the 2028/29 UK tax year — unless you return to the UK earlier (see below).
What If I Still Have UK Earnings?
If you continue to earn income that is taxed in the UK (for example, rental income doesn’t count, but employment or self-employment income does), then your annual pension contribution limit can be based on that income.
- If your UK-taxed income is higher than £3,600, you may be able to contribute more.
- If it’s lower, you can still use the £3,600 minimum allowance.
What Happens After 5 Years?
After you’ve been non-resident for 5 complete tax years, the rules change:
- You can still contribute to your UK pension (if your pension provider will allow it).
- But you will no longer receive tax relief on new contributions.
This is why many expats only contribute during those first 5 years abroad.
Does Returning to the UK Reset the 5-Year Clock?
Yes. If you return to the UK and are tax-resident again, even for part of a tax year, the 5-year allowance resets.
👉 Example: You move abroad in 2024 and contribute for two years. In 2026/27, you move back to the UK for work. The 5-year clock restarts from the tax year you leave again.
Can I Backdate Contributions for Missed Years?
Unfortunately, no. Pension contributions while abroad operate on a “use it or lose it” basis.
If you miss a year, you cannot go back later and make up for it.
You can only make contributions going forward, within the portion of the 5-year window you have left.
Why Might Expats Want to Keep Paying into a UK Pension?
There are several reasons why expats continue UK pension contributions:
- Boost retirement savings with the government top-up (tax relief).
- Keep existing UK pension arrangements active rather than opening a new scheme abroad.
- Maintain UK pension flexibility — UK pensions are generally well regulated, offer a wide choice of investments, and can be more tax-efficient compared to overseas products.
Key Takeaways
- You can contribute to a UK pension while abroad.
- If you have no UK income, you can contribute up to £3,600 a year (gross) for 5 tax years with tax relief.
- If you still have UK-taxed earnings, contributions can be based on those earnings.
- After 5 years, you can still contribute but usually without tax relief.
- Missed years cannot be made up — so use the allowance while you can.
Returning to the UK resets the 5-year clock.
Case Study: Steve Moves to Saudi Arabia
Background
Steve, aged 53, moved from the UK to Saudi Arabia in May 2025 to take up a higher-paid role in the oil and gas sector.
His plan is to work abroad for the next 5–10 years, aggressively build up his savings, and then return to the UK to retire.
Like many British expats, Steve wants to know: Can I keep paying into my UK pension while living overseas?
How the 5-Year Rule Works for Steve
- Because Steve left the UK in the 2025/26 tax year, the clock starts ticking from then.
- He can continue paying into his UK pension with tax relief until the 2029/30 tax year (five full tax years abroad).
- As Steve has no UK-taxed earnings in Saudi Arabia, his maximum tax-relieved contribution is £3,600 per year.
That means each year he pays in £2,880, and HMRC adds £720 in tax relief.
Why It Matters for His Retirement
By using this allowance every year for 5 years:
💰 Steve contributes £14,400 personally (£2,880 × 5).
💰 The government adds £3,600 in tax relief (£720 × 5).
💰 His total pension grows by £18,000 before investment growth.
If his investments grow at, say, 5% per year, this £18,000 could be worth closer to £23,000 by the time he returns to the UK.
Other Considerations for Steve
State Pension: If Steve hasn’t already maximised his UK State Pension entitlement, he can continue to make voluntary contributions while living in Saudi Arabia.
🔗 Expat State Pension guide (2025/2026 update)
Returning to the UK early: If Steve comes back to the UK early (within 5 years), he will need to make sure that he does not fall foul of the Temporary Non-Resident rules.
🔗 Navigating the UK Temporary Non-Residence Rules: A Guide for Expats
Expat ISA rules: As an expat, Steve cannot pay into an ISA. However, as he is living in Saudi Arabia, there are other tax-efficient savings strategies that he can look to use.
🔗 Expat ISA Rules: What Can Be Done With an ISA When You Move Abroad?
Key Lesson from Steve’s Story
For expats like Steve, the £3,600 annual pension contribution may not sound like much compared to their overseas earnings.
But because of the tax relief and the power of compounding, it’s essentially “free money” from the UK government.
Using this allowance while abroad can be a simple way to boost your retirement pot.
📚 Further Reading
🔗 Why Expats Return to the UK (And the Costly Tax Mistakes They Need to Avoid)
🔗 When Bad Advice Costs Everything: How British Expats Can Learn From an England Manager
🔗 How to Save for Retirement as an Expat
🔗 Are UK Pensions Now Liable for Inheritance Tax? The New Pension IHT Rules Unpacked
💡 Final Thoughts
If you’re a British expat, keeping on top of your UK pension can be one of the smartest financial decisions you make.
The rules may seem complicated, but the principle is simple: take advantage of the government’s tax relief while you can, and plan ahead for how your pension fits into your long-term retirement strategy.
If you’re unsure how this applies to your situation, it’s worth getting advice from a financial planner who specialises in working with expats.
Every case is different, especially if you have multiple pensions, significant savings, or are considering retirement abroad.
Post updated 25th September 2025
Talk to an Expert
Ross is a qualified Chartered Financial Planner and Pension Transfer Specialist.
He has been a cross-border financial adviser for 25 years and specialises in helping British expats manage their finances with clarity and peace of mind.
If you would like to have a no strings chat with him, please get in touch.
