Salary Sacrifice Calculator

Enter the amount you sacrifice and your income tax band to see the tax and National Insurance you save, and the real cost to your take-home pay.

Amount sacrificed per year

Your income tax band

Net cost to your take-home

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Income tax saved

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National Insurance saved

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Employee income tax and NI saving only. Employer NI savings (sometimes added to your pension) are not included.

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How salary sacrifice saves tax and NI

You swap part of your gross pay for a benefit, usually a pension contribution. Because it comes out before tax and National Insurance, your take-home falls by less than the amount you sacrifice.

Worked example. A basic-rate taxpayer sacrifices £5,000. They save £1,000 income tax (20%) and £400 NI (8%), so their take-home drops by only £3,600 for £5,000 into their pension.

What it saves

Income tax at your marginal rate (20%, 40%, or 45%).
Employee National Insurance at 8% (basic) or 2% (higher/additional).

This shows the employee saving only. Employers also save NI and sometimes pass it into your pension, which is not included here.

Source: gov.uk National Insurance rates. This is an estimate, not financial advice.

Frequently asked questions

How does salary sacrifice save money?

You give up part of your gross salary, usually into a pension, so you never pay income tax or National Insurance on that slice. A £5,000 sacrifice for a basic-rate taxpayer costs only £3,600 of take-home pay, because £1,000 of tax and £400 of NI are saved.

What is not included here?

This shows your employee income tax and NI saving. Employers also save NI and sometimes add that to your pension, which this does not model. It also assumes the whole amount stays within one tax band.