Those with employers who agree to salary sacrifice

cloud_dog

Novice_investor101 wrote: »

I consider that people who work for my employer & don't pay in the maximum amount of 8% that is matched with 14% are actually helping pay into my pension...

My employer pays in an extra 0.2% in addition to the whole 13.8% NI saving they make.
They only match up to 6% if you pay in the lowest amount of 2%, 7% if you pay in 4% and 9% if you pay in 6% - pocketing the difference (or adding it into the pensions of the people who pay in the maximum 8%).
It's a no brainer to pay in the max & I'm still stunned when I hear people tell me they're on the default 2% still. It's like passing up a payrise!

Are you sure you operate within a SS payroll? The reason I ask is that the employee contribution / employer matching contribution is not related to SS and additional NI savings. It sounds like there may be two distinct things here.

Novice_investor101

It says salary exchange on my payslip & it is a salary sacrifice scheme cos I save on the student loan repayments, too.
They possibly are two distinct things. I was thinking they were saving 13.8% of my salary. Is it 13.8% of the 8% salary I sacrifice that they save?
Either way, 14% from an employer in return for 8% from me is still a great deal considering that it costs me so little in take home pay reduction.

BoxerfanUK

Novice_investor101 wrote: »

It says salary exchange on my payslip & it is a salary sacrifice scheme cos I save on the student loan repayments, too.
They possibly are two distinct things. I was thinking they were saving 13.8% of my salary. Is it 13.8% of the 8% salary I sacrifice that they save?
Either way, 14% from an employer in return for 8% from me is still a great deal considering that it costs me so little in take home pay reduction.

Your employer saves 13.8% of the amount of salary that you sacrifice.

longforgotten

If you have salary sacrifice does it effect :-


a) how much you get should you be off sick
b) death in service payout

AnotherJoe

longforgotten wrote: »

If you have salary sacrifice does it effect :-
a) how much you get should you be off sick
b) death in service payout

A) wouldn't you just get the same as your normal pay ?
it could it would depend on their policies. Eg suppose the payout was 3x salary, they could change it to (say) 3.5x.

grnglide

Normally death in service etc will be calculated on the "reference salary" (or whatever the employer calls it) which is the salary you would have been paid if it wasn't for the sacrifice.


But it all depends on the scheme. Large companies will tend to have thought of all this, small ones may not.

JustAnotherSaver

AnotherJoe wrote: »

A) wouldn't you just get the same as your normal pay ?

What is 'normal pay'?


My pay varies, quite significantly, due to overtime (and overtime is not optional).

We also only get SSP, so whatever is the minimum as laid out by the government.

AnotherJoe

JustAnotherSaver wrote: »

What is 'normal pay'?
My pay varies, quite significantly, due to overtime (and overtime is not optional).
We also only get SSP, so whatever is the minimum as laid out by the government.

Well then surely normal pay would be SSP in that case?

thickasabrick

13.8% of the sacrificed amount.

From my company pension salary sacrifice policy.
"Where an employee chooses to sacrifice an amount of their salary the Company will pay this into the employee’s personal pension plan plus an additional 13.8% of the sacrificed amount."

JustAnotherSaver wrote: »

Mine doesn't do this but it doesn't stop me from asking here & there if they've changed their stance.

I'm just curious - for those of you who work for employers who agree to this, what percentage of the savings do they pass on to you & pay in to your pension?

swindiff

My employer does not pass on any of their NI saving. They do however pay over 21% into my pension so can't grumble too much.