Increased awareness of the tax benefits of pension saving are a cause for optimism, according to Standard Life. A YouGov poll for the insurer found the number of adults aware of pensions’ tax efficiency remained a minority, but at 39 per cent was 10 per cent up from 2012.

“This jump in the number of people who understand the tax advantage of investing into a pension is really positive news,” said Standard Life head of customer relationships Julie Russell. Women, however, still trailed men in their understanding. Almost half (48 per cent) of men claimed to understand the tax benefits, against only 30 per cent of women

“There's still work to be done, as three out of five adults have yet to wake up to the tax efficiency of pensions, and women are clearly lagging behind men in the awareness stakes. But it's good to know that understanding is on the increase,” Russell said.

The biggest advances in knowledge came among younger respondents, with 20 per cent of 18 to 24-year-olds now saying they understand the tax efficiency of pensions saving, double the proportion last year. However, there was still a lack of understanding among 45 to 54 year olds (46 per cent).

Russell said auto enrolment was likely to have driven some of the increase in awareness over the last year.

"And with many more employees being automatically enrolled into a company pension in 2013, I expect awareness to continue to grow.”

Despite this, those investing actively in a personal pension remained significantly more likely to be switched on to the tax efficiency of investing in a pension than those in a workplace scheme, according to the research. Fifty-seven per cent of those with a personal pension understood the benefits, against 47 per cent of those actively investing in a workplace pension.

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