Salary Sacrifice Calculator UK 2026/27
See how much tax and National Insurance you save by paying into your pension through salary sacrifice — and what it really costs your take-home pay.
Into your pension each year
£2,250
Costs you only £1,620.00 in take-home pay (£135.00 a month)
- Tax saved
- £450
- NI saved
- £180
- Total saved
- £630
vs a net pay pension: you keep £180.00 more a year. Your employer saves £338 in employer NI.
Before and after salary sacrifice (yearly)
| Before | After | Difference | |
|---|---|---|---|
| Gross salary | £45,000.00 | £45,000.00 | £0.00 |
| Pension contribution | £0.00 | £2,250.00 | £2,250.00 |
| Income Tax | £6,486.00 | £6,036.00 | £-450.00 |
| National Insurance | £2,594.40 | £2,414.40 | £-180.00 |
| Take-home pay | £35,919.60 | £34,299.60 | £-1,620.00 |
How salary sacrifice saves you money
On a £45,000 salary, sacrificing 5% puts £2,250 a year into your pension, but your take-home pay only falls by £1,620.00. The difference — £630.00 — is Income Tax and National Insurance you no longer pay.
Read more in our guide to salary sacrifice vs net pay pensions, or see the full picture in the take home pay calculator.
Frequently asked questions
What is salary sacrifice?
Salary sacrifice is an agreement with your employer to give up part of your salary in exchange for a benefit, usually a pension contribution. Because your salary is lower, you pay less Income Tax and National Insurance.
Is salary sacrifice better than a normal pension contribution?
Usually, yes. A net pay pension saves Income Tax only, while salary sacrifice also saves National Insurance (8% for most earners, 2% above £50,270). Many employers also pass on some of their own NI saving.
Can salary sacrifice get me under £100,000?
Yes. If your income is between £100,000 and £125,140 you lose part of your Personal Allowance. Sacrificing enough salary to bring your adjusted net income back to £100,000 can save tax at an effective 60% plus 2% NI.
Are there any downsides?
Your salary must not drop below the National Minimum Wage, and a lower salary can affect mortgage applications, some state benefits and life cover based on salary. Check your scheme's rules before signing.
Is salary sacrifice changing?
The government announced in the November 2025 Budget that, from April 2029, pension contributions made through salary sacrifice above £2,000 a year will no longer be exempt from National Insurance. For the 2026/27 tax year the full NI saving still applies.