Salary Sacrifice Pension Calculator 2026/27
See the real take-home cost of a salary-sacrifice pension contribution, and how much further every pound goes than relief-at-source.
Last updated: August 2026 · 2026/27 rates · rUK tax (Scotland not modelled here)
Salary & sacrifice
Annual amount: £6,000
Many employers pass nothing back; some progressive schemes pass 50% or 100% into your pension.
Used to check the National Living Wage floor: £12.71/hour from 1 April 2026 works out at £24,785/year at these hours.
For every £1 of take-home pay you give up
£1.72 into pension
42.0% effective discount vs. paying in from net pay
Net pay you give up each year
Into your pension pot each year
Annual breakdown
Where your sacrificed £6,000 goes
Understanding salary sacrifice
Both routes get money into your pension, but salary sacrifice is materially better because it avoids National Insurance, which relief-at-source does not.
Salary sacrifice
- Reduces gross pay before tax and NI hit it.
- Saves both income tax (20% / 40% / 45%) and NI (8% / 2%).
- Employer's 15% NI on the sacrificed amount is also saved (and may be passed back).
- No Self Assessment claim needed, the saving is automatic.
Relief at source (most SIPPs)
- Contributions come from net pay.
- Provider claims back 20% basic-rate tax automatically.
- Higher-rate or additional-rate top-up requires Self Assessment.
- No NI savings, for a higher-rate taxpayer, that's ~2% lost; for a basic-rate taxpayer, ~8%.
Three scenarios where salary sacrifice delivers outsized returns:
- Income between £100k and £125k. Sacrificing back below £100k reclaims the Personal Allowance, effective relief of ~60% (rUK) or ~63% (Scotland).
- Adjusted net income over £60k with children. Sacrificing into the £60k–£80k HICBC taper zone recovers Child Benefit at face value on top of the income tax + NI saving.
- Employer who passes back 100% of the employer NI saving. Every £1 sacrificed adds £1.15 to your pension before any of your own tax relief.
Related calculators
Other free UK tools that follow on from this calculation.
Salary Calculator
Annual, monthly and weekly take-home pay after PAYE, NI, pension and student loan.
Pension Calculator
Project workplace auto-enrolment and SIPP contributions to estimate retirement income.
Pension Drawdown Calculator
How long a pension pot lasts at a chosen annual withdrawal, with the 25% tax-free lump sum.
HICBC Calculator
High Income Child Benefit Charge between £60k and £80k of adjusted net income.
Reviewed by
Alexandre Bernier, LLM (UK), CFP®, CIM®, PFP®. Financial planner with 18 years in banking and wealth management, holding a UK master of laws and the Canadian CFP®, CIM® and PFP® designations. Writes and reviews every calculator and article on FinanceToolz.
Last updated: August 2026. How figures are sourced, reviewed and corrected is set out in our editorial policy. This is general information, not regulated financial advice.
Sources
Every rate and threshold used by this calculator is taken from the official pages below. If a figure here disagrees with one of these, the official page is right, please tell us.