Why can £100 into the pension cost less than £100 of take-home pay?

Salary sacrifice reduces contractual cash pay before some payroll deductions are calculated, so the take-home reduction can be smaller than the gross pension contribution.

Does my employer have to offer salary sacrifice?

No. Salary sacrifice is an employer arrangement and the exact scheme rules vary.

Does this include employer National Insurance savings?

No. Some employers share some or all of their own National Insurance saving, but that is employer-specific and is deliberately excluded here unless you add a separate calculator later.

Income & tax

Salary Sacrifice Pension Calculator

See the difference between the amount added to your pension and the amount your take-home pay may actually fall. Salary sacrifice can change Income Tax, employee National Insurance and, in some cases, student-loan deductions.

Free calculatorInputs saved only in this browserRules: 2026/27

Your estimate

Use the result as a planning guide and change inputs to test the assumptions that matter most.

How this calculator works

The calculator runs the same payroll model twice using the active tax-year configuration: once at your current salary-sacrifice pension percentage and again at the proposed percentage. The difference shows the extra pension contribution, change in take-home pay and reduction in modelled payroll deductions.

How to use it

Enter salary, bonus and tax region.
Choose any student-loan plan that applies.
Enter your current salary-sacrifice pension percentage.
Enter the higher percentage you want to test.
Compare the extra pension funding with the reduction in take-home pay.

Assumptions and limitations

This models employee salary sacrifice only and does not automatically add any employer National Insurance saving or extra employer contribution. Employers can impose salary floors and pension limits. Complex tax codes, benefits, annual allowance issues and tapered annual allowance are outside the model.