Salary Sacrifice Calculator
Salary sacrifice lets you give up part of your gross pay in exchange for non-cash benefits like pension, car or EV. You and your employer pay less National Insurance, and you pay less Income Tax. This hub covers pension, car, EV, take-home pay and NI savings for 2026/27.
UK salary sacrifice calculator hub. Five calculators in one — pension, car, EV, take-home pay comparison and NI savings — all using the 2026/27 tax year.
More Income and work calculators · All calculators · All guides
What this calculator does
Estimates the impact of a UK salary sacrifice arrangement on take-home pay, Income Tax and National Insurance for pension, car and electric car schemes.
Who it is for
UK employees considering or already in a salary sacrifice arrangement, HR teams and payroll administrators.
How to use it
Pick a calculator (pension, car, EV, take-home pay or NI savings), enter your gross salary and the sacrifice amount, and read the estimated take-home and tax/NI impacts.
How the calculation works
Income Tax uses 2026/27 EW/NI bands (PA £12,570 tapered above £100k, 20/40/45). Employee NI: 8% £12,570–£50,270 then 2%. Employer NI: 15% above £5,000. EV BIK 4%. Minimum wage check uses April 2026 rates.
Worked example
£40,000 salary, 5% pension sacrifice (£2,000/yr) → salary £38,000; tax saving £400; NI saving £160; net cost ≈ £1,440/yr; pension contribution £2,000 (or £2,300 if employer passes 100% NI).
Assumptions and limitations
- 2026/27 tax year only — rates may change
- England, Wales & Northern Ireland Income Tax bands; Scottish bands not yet implemented
- Does not model student loan, pension auto-enrolment minima, blind person allowance, marriage allowance or salary sacrifice scheme rules
- Estimates only — not financial or tax advice
Frequently asked questions
What is salary sacrifice?
An agreement to give up part of your gross salary in exchange for a non-cash benefit such as pension, car or EV. The sacrifice happens before payroll deductions so both employee and employer save National Insurance, and the employee saves Income Tax.
Does salary sacrifice reduce my take-home pay?
Yes — but by less than the sacrificed amount because you save Income Tax and NI on the sacrifice. The take-home pay comparison shows the exact change.
Is salary sacrifice worth it for pensions?
For most UK basic and higher-rate taxpayers, yes. The employer also saves NI and may pass that back into your pension.
What about Scotland?
Scottish income tax bands are not yet supported. The calculator falls back to EW/NI bands and shows a notice.
Will the rules change in April 2029?
HMRC has announced that from 6 April 2029, employer NI relief on salary-sacrificed pension contributions above £2,000/year will be removed. This calculator uses 2026/27 rules and does not apply that future change.
Related calculators
- Car Salary Sacrifice Calculator — Car salary sacrifice gives up salary in exchange for a company car. You save Income Tax and NI on the sacrifice but pay BIK on the company c
- Day Rate Calculator — Enter your annual salary, hourly rate, or target income to calculate your equivalent day rate — or convert a day rate back to an annual figu
- EV Salary Sacrifice Calculator — EV salary sacrifice is highly tax-efficient because the EV Benefit in Kind percentage is just 4% for 2026/27. Income Tax + NI savings on the
- Full-Time Equivalent Salary Calculator — Use this full-time equivalent salary calculator to scale a part-time salary up to its full-time equivalent (FTE). FTE = part-time salary × f
- Holiday Accrual Calculator — Enter your annual entitlement and leave year dates to see how many days you have accrued so far and how many remain.
- Holiday Entitlement Calculator — Full-time UK workers are entitled to at least 28 days (5.6 weeks) of paid holiday per year including bank holidays. Part-time and irregular
Related guides
- How to Calculate Your Freelance Day Rate — A practical guide to setting your day rate as a freelancer or contractor, including salary equivalence and market benchmarks.
- How Overtime Pay Works in the UK — Understand your overtime pay rights, how it is taxed, and how different multipliers affect your earnings.
- How Holiday Accrual Is Calculated in the UK — Learn how holiday builds up over a leave year and how to check how much you have accrued so far.
- Inside IR35 Explained: What UK Contractors Need to Know — A clear guide to working inside IR35, how it affects your take-home pay, and what it means for your contract.
- How Holiday Entitlement Works in the UK — A practical guide to understanding your statutory holiday entitlement as a UK worker, covering full-time, part-time, and irregular working patterns.
- Outside IR35 Explained for UK Contractors — What outside IR35 means, how it affects your take-home pay, and the key differences between inside and outside IR35.
Sources and references
GOV.UK Income Tax rates 2026/27; GOV.UK Rates and thresholds for employers 2026-2027; GOV.UK Salary sacrifice for employers; GOV.UK National Minimum Wage rates April 2026; GOV.UK Company car BIK appropriate percentage tables; GOV.UK changes to salary sacrifice for pensions from April 2029.
Last updated
Last reviewed: 2026-05-21.