pension contributions and psa

A_Aardvarkie

My gross salary takes me into the 40% tax band. Can I increase my company pension contributions, salary sacrifice, in order to increase my PSA to £1000 from £500 ?

Dazed_and_C0nfused

A_Aardvarkie said:

My gross salary takes me into the 40% tax band. Can I increase my company pension contributions, salary sacrifice, in order to increase my PSA to £1000 from £500 ?

No as you cannot make pension contributions under salary sacrifice.

You can increase your employer's contributions using salary sacrifice.

Sacrificing pay so your employer makes additional pension contributions reduces your taxable pay figure so could well move you from one rate band to another.

Remember you calculate which rate band you are ignoring the savings nil rate (aka PSA) first.  Then based on what that shows your highest rate to be you then factor in the savings nil rate band of up to £500 or £1,000 interest being taxed at 0%.

P1Fanatic

Also check your total taxable salary as things like Medical Insurance, Oncall / Shift Allowance, Bonuses etc can all bump it up further over your base salary.