✓ 2026/27 HMRC Rates · All UK regions

See exactly how much you save through salary sacrifice

Most employees with a workplace pension are leaving hundreds of pounds of tax savings untouched every year. See your number in 30 seconds.

£630/yr
Typical saving — £45k salary, 5% contribution, basic rate taxpayer
£833/yr
Typical saving — £45k salary, 5% contribution, with Plan 2 student loan

Salary Sacrifice Calculator

All UK regions including Scotland · 2026/27 tax year

Before any deductions — from your contract or payslip
£
The % of your salary you put into your pension
5%
Scotland has different income tax rates
%

💷 Enter your salary above to see your saving

✓ Scotland supported: Select your region above. Scottish income tax has six bands (19%–48%) and salary sacrifice can be especially valuable for Scottish higher-rate taxpayers, who pay 42% above £43,663.
Why this calculator

The most accurate — and the most honest

Most salary sacrifice calculators are run by pension providers selling their own product. We're not.

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Works for Scotland

Scottish income tax has six bands from 19% to 48%. We calculate every one. Most calculators — including major providers — don't support Scotland at all.

Others don't
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Genuinely independent

We're not owned by a pension provider. We show you the real number, then point you wherever suits you — not toward our own product.

No agenda
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Counts your student loan

Salary sacrifice lowers the pay your student loan is calculated on. We factor in Plan 2 and Plan 5 — a saving most tools never show you.

Often missed
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Current for 2026/27

Correct employer NI at 15%, today's thresholds, and ready for the April 2029 salary sacrifice changes. Checked against HMRC daily.

Always up to date
How it works

Three words: you never earned it

Salary sacrifice sounds complicated. It isn't.

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Step 01

You agree an arrangement

You ask your employer to reduce your official salary and pay the difference directly into your pension. Your employer must agree — most do because they save money too.

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Step 02

You officially never earn it

Because the pension contribution comes before payroll, HMRC never sees that money as income. You pay no income tax and no National Insurance on it — as if it never existed.

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Step 03

Your pension grows, sheltered

The money sits in your pension, invested and growing — sheltered from income tax and NI. If you have a student loan, your repayments reduce too. Our calculator shows the full picture.

📌 Coming in April 2029: the £2,000 cap

At the Autumn 2025 Budget, the government announced that from 6 April 2029, National Insurance relief on salary sacrifice pension contributions will be capped at £2,000 a year. Anything above that is treated as normal earnings for NI — so both you and your employer pay NI on the excess.

The first £2,000 stays NI-free. Sacrifice less than that and nothing changes for you. Sacrifice more, and the extra loses its NI saving from 2029.

What it means right now: until April 2029, salary sacrifice NI savings stay uncapped. If you've been meaning to increase your contributions, the next three tax years are the most efficient window to do it.

Where to put the money

Open or consolidate your pension

We're not owned by any of these providers. We include them because our readers ask where to start.

PensionBee
From 0.50%/yr · FCA regulated
Consolidate old pensions into one place. App-based management, simple transparent fees. Popular with people who've had several jobs.
Get started free →
Sponsored · We may earn a commission · Capital at risk
Nutmeg
From 0.25%/yr · FCA regulated
Managed investment portfolios covering pensions, ISAs and LISAs. Choose from fully managed, fixed allocation, or socially responsible options.
Compare plans →
Sponsored · We may earn a commission · Capital at risk
Vanguard UK
From 0.15%/yr · FCA regulated
Low-cost index fund investing. One of the cheapest SIPP providers in the UK. Best suited to those comfortable choosing their own funds.
Learn more →
Sponsored · We may earn a commission · Capital at risk
Capital at risk. Past performance does not guarantee future results. We are not FCA-authorised and do not provide regulated financial advice. Always read the Key Investor Information Document before investing.

Saving for your children too?

Beanstalk is an FCA-regulated Junior ISA and ISA app that makes it simple for families to invest for their children's future. Low fees, and friends and family can chip in too. A natural next step once your own pension is sorted.

Explore Beanstalk →
Sponsored · We may earn a commission · Capital at risk
Common questions

Frequently asked

The questions we get asked most — click any to expand.

It depends on your tax band. Basic rate taxpayers (£12,571–£50,270) save approximately 28p for every £1 contributed — 20p in income tax and 8p in National Insurance. Someone earning £45,000 and contributing 5% (£2,250/year) saves around £630 per year. Higher rate taxpayers (above £50,270) save approximately 42p per £1 — the higher your income, the more powerful salary sacrifice becomes.
For most employees, yes. A personal pension contribution gets income tax relief added by HMRC, but you still paid National Insurance on the money before it went in. Salary sacrifice avoids both income tax and NI, making it more efficient in nearly every case. The one exception: if sacrifice would push your salary below the National Living Wage, your employer cannot legally offer it. This mainly affects lower earners or part-time workers.
Yes — and this saving is often overlooked. Student loan repayments are calculated on your pensionable pay, which is reduced when you salary sacrifice. For Plan 2 loans (most people who started university 2012–2023), you repay 9% of earnings above £29,385 in 2026/27. Sacrificing £3,000 reduces your annual student loan repayment by £270. This calculator includes that saving — tick the student loan option to see your full picture.
Potentially. Most mortgage lenders base affordability on your gross salary — if salary sacrifice reduces that figure, some lenders may offer a smaller mortgage. However, many lenders — particularly those experienced with public sector workers — understand salary sacrifice and will use your pre-sacrifice salary for affordability calculations. Always disclose any salary sacrifice arrangement to your mortgage broker before applying.
Usually yes, but with rules. Most employers allow changes at specific points — typically annually during open enrolment, or on a life event such as changing jobs, getting married, or having a child. Some employers are more flexible. The exact rules depend on your employer's scheme rules. Check your employee handbook or ask your HR or payroll team.
When you salary sacrifice, your employer also saves National Insurance — currently 15% of the sacrificed amount (raised from 13.8% in April 2025). On a £2,250 sacrifice, that's about £338 the employer keeps. Some employers pass this saving back to employees as an additional pension contribution, which is an excellent deal for both parties. It costs the employer nothing extra and meaningfully boosts your pension. Ask HR whether your employer operates such a scheme — many do, but won't advertise it.
No. This calculator provides general information based on published HMRC rates for 2026/27. It covers England, Wales and Northern Ireland, and supports Scotland's separate income tax bands when you select Scotland as your region. The figures are estimates based on standard calculations and your actual saving may differ depending on your employer's pension scheme rules and personal circumstances. Always speak to an Independent Financial Adviser before making significant pension decisions. You can find one at unbiased.co.uk.
Yes. Scotland has six income tax bands from 19% to 48%, and this calculator supports all of them — select Scotland in the region dropdown above. Salary sacrifice is especially valuable for Scottish higher-rate taxpayers, who pay 42% income tax on earnings above £43,663 in 2026/27, plus the National Insurance saving on top. Most salary sacrifice calculators don't support Scottish rates at all.
Yes. At the Autumn 2025 Budget, the government announced that from 6 April 2029, National Insurance relief on salary sacrifice pension contributions will be capped at £2,000 a year. Below that, nothing changes. Above £2,000, the excess is treated as normal earnings and both you and your employer pay NI on it. Until April 2029, salary sacrifice NI savings remain uncapped, so the next few tax years are the most efficient time to make larger contributions.