Salary Sacrifice Calculator
See how much salary sacrifice really costs you
Salary sacrifice reduces your gross pay before tax and NI are calculated, giving you a double saving over a personal pension. Calculate your exact NI saving and monthly benefit.
Your annual benefit
£840
Your saving
income tax + NI
+£3,000
Pension increase
vs no sacrifice
72p
Net cost per £1
of pension
As a 20% taxpayer, salary sacrifice saves you 20% income tax AND 8% NI — 28% combined. Every £1 of pension only costs you 72p.
Before and after comparison
| Metric | Without | With sacrifice |
|---|---|---|
| Gross salary | £45,000 | £45,000 |
| Salary after sacrifice | — | £42,000 |
| Income tax | £6,486 | £5,886−£600 |
| Employee NI | £2,594 | £2,354−£240 |
| Take-home pay | £35,920 | £33,760−£2,160 |
| Pension contribution | £0 | £3,000+£3,000 |
Take-home reduces by £2,160/year but your pension increases by £3,000/year — a net benefit of £840/year.
Tax and NI saving breakdown
| Income tax saving | £600 | 20% |
| Employee NI saving | £240 | 8% |
| Total saving | £840 | 28% |
| Net cost to you | £2,160 | 72% |
Why salary sacrifice beats a personal pension
Employer NI saving: £450/year
Your employer saves £450 in employer NI contributions. Many employers pass some or all of this back into your pension — worth asking your HR team.
Annual allowance tracker
£3,000 of £60,000
5% used
Salary sacrifice reduces your contractual salary. This can affect: statutory maternity/paternity pay, mortgage affordability assessments, life insurance cover (if based on salary multiples), and some means-tested benefits. Check with your employer.
Read our ISA vs SIPP article for more on pension tax efficiency.
Your details
Your total salary before any deductions
How much of your gross salary to redirect into your pension
Already contributing to a pension?
Does your employer share their NI saving?
Used for NMW compliance check
Scottish income tax rates
Applies to residents of Scotland only
Want a complete retirement projection?
For a complete retirement projection including tax, State Pension, and 10,000 Monte Carlo simulations — use our full retirement planner.
This calculator provides estimates for guidance only. Results are illustrative and do not constitute financial advice. Always verify figures with a qualified adviser.