Workplace pension vs personal pension — what's the difference?
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In short. A workplace pension comes with an employer contribution (usually 3% minimum) and is set up by your employer under auto-enrolment. A personal pension is one you arrange yourself — no employer match, but full control over the provider and investments.
Most UK employees aged 22 to State Pension age earning £10,000+ are auto-enrolled into a workplace pension. The headline difference is the employer contribution: extra money you don't get from a personal pension. Personal pensions exist alongside, not instead of — most people use both.
Last reviewed:
Side by side
Who sets it up
Workplace pension
Your employer
Personal pension
You (with a pension provider)
Employer contribution
Workplace pension
Minimum 3% of qualifying earnings
Personal pension
None
Your minimum contribution
Workplace pension
5% of qualifying earnings (incl. tax relief)
Personal pension
Your choice
Tax relief
Workplace pension
At your marginal rate
Personal pension
At your marginal rate
Investment choice
Workplace pension
Limited to scheme's fund range; usually a default lifestyle fund
Personal pension
Wide — full SIPP gives access to funds, shares, ETFs, trusts
Charges
Workplace pension
Capped at 0.75% on default funds in auto-enrolment
Personal pension
Vary — platform + fund charges, often 0.3–1.0% combined
When you can access
Workplace pension
55 (rising to 57 in April 2028)
Personal pension
55 (rising to 57 in April 2028)
When Workplace pension usually wins
- You're employed and eligible for auto-enrolment
- You want the employer match (always take the full match available)
- You prefer a default 'do it for me' option
- You want low charges without shopping around
When Personal pension usually wins
- You're self-employed, a director, or not auto-enrolled
- You want full control over investment choice
- You're consolidating old pension pots in one place
- You want to top up beyond your workplace scheme
Related quick answers
FAQ
- Should I opt out of my workplace pension?
- Opting out means losing the employer contribution and tax relief — generally a significant cost. Information only, not advice.
- Can I pay into both a workplace and a personal pension?
- Yes. The combined contributions across all your pensions are subject to the annual allowance (£60,000 for most people in 2026/27) and your relevant earnings.
- What happens to my workplace pension if I leave the employer?
- It stays in your name. You can leave it, transfer it to a new employer's scheme, or transfer it into a personal pension or SIPP — there are pros and cons to each.