Salary Sacrifice Pension Calculator (UK)
See how sacrificing a portion of your salary can boost your pension and reduce your tax.
Advanced Options
Percentage of the employer’s National Insurance saving that they add to your pension.
Your Results
| Description | Without Sacrifice | With Sacrifice |
|---|---|---|
| Gross Salary | ||
| Pension Contribution | ||
| Income Tax | ||
| National Insurance | ||
| Take-Home Pay |
Increase in Take-Home Pay
£0.00
Per Year
Boost to Your Pension
£0.00
Per Year
About Our Tool
A Salary Sacrifice (or Salary Exchange) scheme is a popular arrangement where you agree to reduce your salary by an amount equal to your pension contributions. In return, your employer pays your total pension contributions for you. This simple change can lead to significant savings for both you and your employer.
This calculator is designed to illustrate how much you could save in National Insurance and Income Tax, and how much extra could be added to your pension pot if your employer passes on their National Insurance savings.
Key Features of Our Tool
- Clear Comparison: See a side-by-side breakdown of your take-home pay with and without salary sacrifice.
- NI Savings: Instantly see how much you could save on National Insurance contributions.
- Pension Boost: Calculate the potential extra amount added to your pension if your employer shares their NI savings.
- UK & Scottish Tax Bands: Accurate calculations for different tax regulations across the UK.
- Mobile-Friendly Design: Easy to use on any device, from desktop to smartphone.
How To Use This Tool
- Enter Your Gross Salary: Input your total annual salary before any deductions.
- Set Sacrifice Percentage: Enter the percentage of your salary you wish to contribute to your pension.
- Add Employer Contribution: Input the percentage your employer contributes.
- Use Advanced Options (Optional): Specify if your employer will pass on their National Insurance savings and select your tax location.
- Click Calculate: See a detailed breakdown of your savings and pension boost.
Frequently Asked Questions
Q: How does salary sacrifice save me money?
A: By reducing your gross salary, you and your employer pay less National Insurance. You also pay less income tax. This means your take-home pay can increase, even while your pension contributions go up.
Q: Is salary sacrifice suitable for everyone?
A: It’s beneficial for most, but not always. If sacrificing your salary takes your earnings below the National Minimum Wage or certain benefit thresholds, it may not be right for you. It can also affect things like life insurance cover or mortgage applications that are based on your contractual salary.
Q: Does my employer have to pass on their NI savings?
A: No, this is at the employer’s discretion. Many employers choose to pass on some or all of their savings as an extra incentive, which further boosts your pension pot at no extra cost to you.