How the TaxOptions Pension Salary Sacrifice Calculator Works

See the trade-offCompare take-home pay and pension saving at different levels

Understand the savingSee where Income Tax and National Insurance savings come from

Catch key limitsCheck pension allowances and important limitations

What pension salary sacrifice means

With salary sacrifice, you agree to give up part of your contractual cash pay. Your employer pays that amount into your workplace pension instead. As your cash pay is lower, the amount subject to Income Tax and employee National Insurance can also be lower.

Your employer must offer salary sacrifice and agree the arrangement. Scheme rules, payroll treatment and the effect on other employment benefits can vary.

New to the arrangement? Start with our plain-English guide to what pension salary sacrifice is.

How your results are calculated

You enter your gross salary, bonus and any other employment or taxable income.
You add the pension terms offered by your employer and any other pension input you know about.
The calculator estimates your position without salary sacrifice.
It recalculates Income Tax, employee National Insurance, adjusted net income, take-home pay and pension input at the sacrifice level you select.
It shows the difference from no sacrifice and highlights relevant tax zones or allowance cautions.

Income Tax and adjusted net income

The calculator uses the 2026/27 Income Tax rates and bands for England, Wales and Northern Ireland. It models the Personal Allowance taper, under which £1 of Personal Allowance is lost for every £2 of adjusted net income above £100,000.

Salary sacrifice can reduce adjusted net income, but adjusted net income can include more than salary. The calculator uses the other employment and taxable income you enter to help estimate your position. Dividend and savings tax is simplified, so the result is not a tax return calculation.

National Insurance

Employee National Insurance is estimated using 2026/27 Class 1 category A rates. Other employment income entered, such as taxable RSUs or share-option gains, is included in employee National Insurance. Other taxable income is not. Employer National Insurance saving is estimated using the standard 15% rate and the percentage you say your employer adds to your pension.

Employer pension contributions

The calculator models the employer match and maximum matching percentage you enter. Your employer's scheme may calculate contributions using pensionable pay rather than total salary, or may use different rules for bonuses.

Pension annual allowance

The estimated pension input combines the salary sacrificed, modelled employer benefits and any other pension input you enter. It compares this with the available annual allowance entered or calculated in the tool, including carry-forward when provided.

The Money Purchase Annual Allowance needs a separate check

If you have flexibly accessed a defined contribution pension, the Money Purchase Annual Allowance may apply. It is £10,000 for 2026/27 and unused allowance cannot be carried forward to increase it. TaxOptions does not establish whether you have triggered it.

Childcare support

The calculator can estimate selected childcare support that may become available when adjusted net income falls below £100,000. Eligibility depends on both partners and other conditions. If a partner's position is uncertain, childcare is left out of money saved rather than guessed.

Main limitations

Scottish Income Tax rates and bands are not covered.
Dividend and savings income is treated using a simplified approach.
Rental profit, taxable share awards and other income are only as accurate as the figures entered.
Gift Aid, personal pension contributions outside salary sacrifice and other deductions from adjusted net income are not modelled.
Defined benefit pension growth is not calculated.
Carry-forward is accepted as entered and is not checked against every eligibility rule.
Payroll timing, student loans, benefits, tax codes and other deductions are not modelled.
Future tax on pension withdrawals and investment growth are not projected.

The figures are estimates for exploring options, not financial advice. Confirm any change with your employer and consider regulated financial advice if you are unsure.

Official sources

Explore your pension salary sacrifice options

Enter your details and compare different sacrifice levels using 2026/27 tax rules.

Use the calculator

Need personalised advice?

A regulated financial adviser can consider your pensions, employer scheme, tax position and wider financial goals. They can help you decide whether a pension salary sacrifice level is suitable for you and how it fits into your longer-term plan.

After seeing your results, you can ask TaxOptions to look for a potential adviser match. We will ask for your permission before sharing your details.

Request a financial adviser