Salary sacrifice calculator 2026/27
See what salary sacrifice does to your take-home pay and your pension, and how it compares with relief at source and net pay for the same contribution.
The three ways to pay in, at £50,000
Announced for April 2029
The government has announced that from April 2029, salary sacrifice above £2,000 a year will pay employee National Insurance. It is announced rather than in force. Below that cap nothing changes, and the income tax saving stays whatever you sacrifice. On this salary a £2,500 sacrifice is £500 above the cap, which at today’s National Insurance rates would cost £39.96 a year.
Common questions
How much does salary sacrifice save?
On £50,000 with 5% sacrificed, £2,500.00 goes into the pension and take-home pay falls by £1,800.08, because the pay given up is never taxed and never charged National Insurance. That is £500.00 of income tax and £199.92 of National Insurance, so a pound in the pension costs you 72p.
Is salary sacrifice better than relief at source?
For take-home pay, yes on £50,000 with 5% sacrificed: £37,720.04 against £37,520.12 on relief at source for the same contribution. Relief at source adds basic-rate relief inside the pension and a higher-rate taxpayer claims the rest through Self Assessment; salary sacrifice saves the National Insurance as well, which neither of the others does.
What does salary sacrifice affect besides tax?
It lowers your contractual pay, which is the figure used for redundancy pay, mortgage affordability, statutory maternity pay and anything else worked out from earnings. Employers usually protect some of those; ask which before you start.