Three quarters of UK employees are unaware they are eligible for tax relief on their pension contributions.

Research from insurance company Zurich shows 82% of those aged between 25 and 34 are unaware of tax relief on defined contribution pensions, which means they are unable to take advantage of tax and national insurance contribution exemptions if they pay into their scheme from gross pay.

80% of women and 70% of men are unaware of the tax relief option and of those over 55 and approaching retirement 69% do not know about tax benefits.

Tony Solomon, business development director at Zurich, said: "There is still a lot of work to be done in getting across the message about making the most of the tax advantages from saving within a pension.

"The UK as a whole is undersaving for retirement and this needs to be addressed. Providers, the Government and advisers must work together to help people understand the importance of saving for a decent income in retirement. Increased confidence will, in part, come with increased understanding."