Pension fees · Guide

What is an AMC — and how does it affect my pension?

The AMC is the annual charge your pension provider levies to run the wrapper around your investments. It's the most-quoted pension cost figure — but it's rarely the only one. Here's what it means and where it sits relative to the total cost you actually pay.

By Pension Bible editorial team·Last reviewed 9 April 2026·4 min read

AMC definition and history

AMC — Annual Management Charge — is the fee a pension provider charges each year for administering and running your pension wrapper. It's deducted from your pot automatically, typically monthly or annually, as a percentage of the total value held.

The phrase dates from the era when UK personal pensions were sold as bundled products: you bought a pension from a life insurance company, the company invested your money, and the AMC covered everything — administration, investment management, advice commissions, and the company's profit margin — in a single headline number. A 1% AMC on a 1990s personal pension encompassed the full cost of the product.

That bundled model has largely broken down. Modern pension platforms — SIPPs, workplace auto-enrolment schemes, and newer personal pensions — typically charge a platform AMC for the wrapper and a separate fund charge for the investment inside it. The AMC now means the wrapper cost specifically, not the total cost of ownership.

This shift matters because it makes direct comparison harder. An older policy quoting a "1% AMC" may include everything. A newer platform quoting "0.25% AMC" almost certainly has additional fund charges on top. You need both figures to understand what you're actually paying.

AMC vs OCF: the difference

The OCF — Ongoing Charges Figure — is the annual charge levied by the fund manager for running the underlying investment. It's a separate charge from the AMC and applies regardless of which platform holds the fund.

The key distinction:

• AMC = what the pension platform charges to hold your pot
• OCF = what the fund manager charges for running the fund your pot is invested in

Both are expressed as annual percentages and both are deducted from your investment returns. The total annual cost of your pension is the AMC plus the OCF.

For example: a platform charging a 0.25% AMC with your money invested in an actively managed fund with a 0.85% OCF has a total annual cost of 1.10%. A different platform charging 0.45% AMC with a passive index tracker at 0.22% OCF has a total annual cost of 0.67%. Despite the lower AMC on the first platform, the second is significantly cheaper overall.

This is why quoting an AMC alone, without knowing the OCF of the fund you're in, is incomplete information. Providers are required to disclose the OCF on the Key Investor Information Document (KIID) or fund factsheet for every fund they offer. If you don't know your fund's OCF, look it up before comparing providers.

A related term occasionally used in older scheme documentation is the TER — Total Expense Ratio. The TER was a precursor to the OCF and typically included the same costs; the two terms are broadly interchangeable for most purposes, though the OCF is now the regulated standard disclosure figure for funds sold in the UK.

Typical AMC ranges

AMC levels vary considerably across the UK pension market in 2025/26:

Cheapest SIPP providers: 0.10% – 0.15% The budget end of the market charges very low AMCs, usually subject to a minimum annual fee or with a fee cap at larger pot sizes. These providers typically offer a narrower fund range.

Mainstream SIPP and personal pension platforms: 0.25% – 0.55% The majority of modern UK pension platforms sit in this range. At this level, the fund OCF is usually the larger component of total cost — particularly if the platform's default fund is actively managed.

Workplace auto-enrolment defaults: 0.22% – 0.50% (all-in) Workplace schemes in auto-enrolment are capped at 0.75% total charges on the default fund. Most well-run schemes come in at 0.3–0.5%, sometimes with the AMC and OCF bundled into a single reported figure.

Legacy personal pensions and older insurance-company products: 0.75% – 1.5%+ Policies sold before 2012, particularly those from life insurance companies rather than platform providers, frequently carry AMCs of 1% or above. Some pre-RDR policies include trail commission (now banned on new policies but still running on old ones) within the stated AMC. If you have an old policy and haven't checked its charges recently, it's worth doing so — the comparison against current market rates is often stark.

To see how different AMC levels affect your pot in pound terms over your investment horizon, use the pension fee calculator. The compound impact of even a 0.5 percentage point difference is substantial over a 20–30 year period, and it's the single most useful calculation for anyone deciding whether to consolidate or switch providers.