childcare vouchers and pensions

ess39

hi, is it true that if you take childcare vouchers and you have a pension then because your salary is lower then both you and your employer will pay less into your pension plan? thanks

onlyroz

Don't believe so, but if you're unsure speak to the HR department at work.

Savvy_Sue

ess39 wrote: »

hi, is it true that if you take childcare vouchers and you have a pension then because your salary is lower then both you and your employer will pay less into your pension plan? thanks

I believe so, at least half true.

If your employer is paying a % into your pension, then that's a % of your salary AFTER vouchers.

If you are paying into your pension, you can probably choose to make it either a % of your pre-voucher salary, OR a fixed amount.

However,

LINKING TO ARTICLES

Hi, Martin’s asked me to post this: There’s an article on the main site you might like to read that gives more information on this subject.

That will explain it better than I can!

Spendless

DH queried this with HR cos we use childcare vouchers and the reply he got was that they take the pension amount he contributes away from his top line first. He pays a fixed amount not a %. I'd query it with your HR.

surreysaver

I am in a final salary pension scheme, and also have childcare vouchers on a salary sacrifice arrangement. However, both myself and my employer pay the same pension contributions and I will recieve the same pension at the end (and death in service benefit) as if I was not having childcare vouchers. So, it depends on your individual employer - you will need to speak to someone there, and make sure they know what they are talking about (probably someone in paybills or HR).

So, for me, the sole issue of childcare vouchers is I pay less tax and NI. Nothing else is changed. But your employer may be different.

conradmum

Yes, you need to check with your employer as to whether they take the pension contribution before or after deducting the cost of childcare vouchers. Each employer is different.

jackomdj

Unfortunately mine is one which pays at the lower rate, although I can pay AVC's which are (unfortunately) not matched. It is still better for me to use the vouchers though.

Nicky