Pension salary sacrifice calculator
What a pension salary sacrifice does to your take-home pay in the current tax year, worked out line by line.
Your estimate
Take-home pay here means salary after income tax and employee National Insurance (NI). It excludes student loan repayments and other deductions. Pension figures show this salary sacrifice and any employer NI saving added, not your total pension contributions.
Enter your details above to see your estimate.
| Per month | Without sacrifice | With sacrifice |
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How your annual take-home pay is worked out
Every step is shown annually so the calculation is easy to follow. Income tax is calculated for the year. National Insurance (NI) is estimated from annual figures; your employer calculates it each pay period, so payslips may differ. Monthly figures are the annual amounts divided by 12.
| Step | Without sacrifice | With sacrifice |
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What each further £1 of sacrifice saves
The tax and NI saving on each further £1 sacrificed, before minimum wage and scheme limits apply.
| Pay between | Saved per £1 |
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What salary sacrifice is
Salary sacrifice is an agreement with your employer to give up part of your salary. In return, your employer pays the same amount into your pension. The lower salary can reduce income tax and National Insurance for you and your employer. Some employers add part or all of their own saving to your pension. For a car scheme, use the Electric car salary sacrifice calculator.
Your pension receives the salary you give up. Where income tax or NI would have been due on that salary, the reduction in take-home pay is smaller. The saving depends on your income. Between and of income, salary sacrifice can also restore some of the personal allowance that is withdrawn as income rises.
There are limits. Your employer cannot sacrifice pay that would take you below the National Minimum Wage for your hours. If pay falls below the National Insurance lower earnings limit of a year, the year may not count towards your State Pension. Contributions above your annual allowance are taxed. The standard allowance is , but yours may be lower. Lower pay can also reduce anything worked out from your salary, such as statutory maternity or sick pay, life cover and the amount a mortgage lender will offer. Sacrificed pay goes into a pension, so you cannot take it back out before the age at which pensions can be accessed.