What you save
| Taxpayer | Saving per £100 sacrificed |
|---|---|
| Basic rate (England) | £28 |
| Higher rate | £42 |
| £100k–£125k band | £62 |
| Plan 2 loan above threshold | Add £9 |
Common schemes
Pensions are the most common. Electric car schemes are popular because EVs have low BIK rates. Cycle-to-work and technology schemes also exist.
Downsides
A lower salary may affect mortgage affordability, statutory maternity pay and life cover linked to salary. You can't sacrifice below the National Minimum Wage. The government plans to limit NI relief on pension sacrifice above £2,000 from April 2029.
Read the arrangement as well as the saving
A favourable tax comparison is only one part of the decision. Check the cash salary, benefit terms and effect on salary-linked arrangements with the employer before comparing offers.
Try it with your own numbers
Calculate how salary sacrifice for a pension, EV or cycle scheme affects your take-home pay, tax and National Insurance in 2026/27.
Frequently asked questions
Can I stop salary sacrifice?
Usually only at set times, such as annual benefit renewal, or after a life event like marriage or a new baby.
Check it on GOV.UK: Salary sacrifice and the effects on PAYE (opens GOV.UK in a new tab)
Sources
Tax year 2026/27. Check these official sources for current rules and deadlines.
Related calculators
- Salary Sacrifice Calculator — Calculate how salary sacrifice for a pension, EV or cycle scheme affects your take-home pay, tax and National Insurance in 2026/27.
Related guides
- Pension Tax Relief — How pension tax relief works in the UK, the difference between net pay and relief at source, and how higher-rate taxpayers claim extra relief.
- Benefits in Kind — How benefits in kind are taxed, from company cars to private medical insurance, and how to work out the cost to you.
- The Personal Allowance Explained — How the £12,570 Personal Allowance works, who loses it, the £100,000 taper and the 60% trap, plus ways to protect it.