Bonus Sacrifice

F1N

Hi,

I've received a bonus from my employer, and have the option to sacrifice a portion/all of it in to my pension without paying tax or NI. I already have a salary sacrifice DC pension with them, where they keep the NI savings they make. I'm in my mid 20's, lower rate tax payer, no mortgage, and if I take the bonus as part of my salary I'd put it in a saving account.

I'm wondering if it's worth me sacrificing the bonus, or if I should keep it.

beyondthehorizon

It depends on what your goals are and how much the bonus is?

Once you put it into the pension scheme you can't access the monies until your retirement.

Are you saving for a particular purpose i.e. a deposit for a property etc.

If you feel it would take you one step closer to your goal then keep it or if you think you don't/won't miss what you never had then sacrifice it

Masomnia

For me it would depend on employer contributions. If they don't match anything that you put in I personally wouldn't bother.

F1N

Thanks for the replies.

The bonus is 6k. I'm not saving for anything in particular atm. When I decide to buy a property I should be ok for a deposit, with savings.

For the salary sacrifice they contribute to the pension, however for the bonus they don't contribute any saved NI . From what I've read, I can put the net cash into a personal pension plan and get the tax back, but not the NI. My savings/company pension is quite good, and I'm not sure when I'd open my own pension plan.

jamesd

The employee NI saving is significant but given your age I'd probably go with a S&S ISA if you're already making good pension contributions.