AVCs and salary sacrifice

Nasa

I am part of a DB pension 1/60th with the Social Housing Pension Scheme.  My employer offers salary sacrifice too. I have asked my employer if I pay AVCs will I benefit from paying less tax, NI and student loan.  They responded and said I would only benefit by paying less tax.  I'm wondering if this is correct?

Thanks,

Dazed_and_C0nfused

That sounds like net pay, not salary sacrifice.

Where have you read that they offer salary sacrifice?

Nasa

I got this extract from the Employer Administration Guide -

"If a member pays AVCs to an arrangement administered by TPT, the AVCs should be included in the monthly data submission and must be identified separately from the normal contributions. You should collect the AVCs through the payroll in the same way that normal contributions are collected. You should deduct AVCs from gross pay, in the same way as normal scheme contributions, before calculating tax under the PAYE system."

Dazed_and_C0nfused

Which doesn't mention salary sacrifice.

What method is used for your normal contributions?  Net pay or relief at source?

Updated - the DB scheme guide clearly states net pay.

Nasa

From employer - 
"You are a member of the Social Housing CARE pension scheme. In 2017, we rolled out a salary sacrifice scheme for members of the above scheme and this is called ‘Salary Exchange’, and by signing up to the scheme, members could make a saving on the amount of national insurance they pay each month from their salary"

Albermarle

You should deduct AVCs from gross pay, in the same way as normal scheme contributions, before calculating tax under the PAYE system."

This would indicate that normal contributions and AVC contributions are taken from salary before tax is taken . So a Net pay arrangement . In which case you will not save NI , as you would if it was a salary sacrifice scheme.

You may wish to ask your employer why they do not operate a salary sacrifice arrangement , as they can also save on employers NI .

Nasa

My payslip also states in Payments section "Salary Exchange SHPS CARE" and lists a sum deducted.

My employer said AVC’s are not currently available on a salary sacrifice arrangement and therefore you will only be liable for tax relief on AVC’s and not national insurance.

Does this seem correct?

MaxiRobriguez

Nasa said:

My payslip also states in Payments section "Salary Exchange SHPS CARE" and lists a sum deducted.

My employer said AVC’s are not currently available on a salary sacrifice arrangement and therefore you will only be liable for tax relief on AVC’s and not national insurance.

Does this seem correct?

That's your answer then.