A Personal Pension Plan is a tax-efficient savings plan for retirement. Tax relief iscalculated at your marginal rate of tax. This type of plan can be set up for you if you are a Sole Trader or an Employee with no access to an Executive Pension Plan / Occupational Pension Scheme. This is a private pension. If all contributions are taken from your Sole trader bank account before the Income Tax deadline, it is taken off from your earnings before personal income tax is calculated.