Three methods can produce different-looking records
| Method | Record feature to confirm | What not to infer |
|---|---|---|
| Salary sacrifice | A contractual reduction in cash entitlement with an employer pension contribution | That every benefit or arrangement has the same PAYE and NI effect |
| Net pay arrangement | Employee contribution taken before PAYE income tax | That “net pay” means the final take-home amount or automatically changes NI |
| Relief at source | Employee contribution shown after tax and NI; provider adds basic-rate relief | That the payslip line includes the provider top-up |
Reconcile contract, payslip and provider records
- Ask the employer or provider to name the scheme tax-relief method.
- For salary sacrifice, compare the contract and payslips before and after the change.
- Confirm whether contribution percentages use actual, qualifying, pensionable or notional pay.
- Check whether the displayed pension amount includes or excludes provider-claimed relief.
- Keep current payroll treatment separate from the scheduled April 2029 change.
Existing calculators remain scenarios, not UK pension advice
Salary Sacrifice or Pre-Tax Benefit Impact uses a user-entered flat rate and benefit value. It does not apply HMRC payroll rules, select a scheme method or project the scheduled 2029 change.
Pension Equivalent Value estimates an entered payment stream under user assumptions. It does not determine workplace-pension contributions, tax relief or whether salary sacrifice is suitable.
Frequently asked questions
- Does “net pay arrangement” mean the contribution is taken from final take-home pay?
- No. It is the name of a pension tax-relief method in which the employee contribution is taken before PAYE income tax. Confirm the scheme method rather than relying on the everyday meaning of “net pay”.
- Should the April 2029 change be used in a current payslip estimate?
- No. It is a scheduled future rule. Current records and calculations must use the rules effective for their own pay period.
Sources checked
- Salary sacrifice for employers — HM Revenue & Customs (accessed 2026-08-01): Current contract, cash-pay, PAYE, National Insurance and workplace-pension boundaries.
- Workplace pensions: managing your pension — UK Government (accessed 2026-08-01): Net-pay and relief-at-source payslip interpretation.
- Changes to salary sacrifice for pensions from April 2029 — HM Treasury (accessed 2026-08-01): Scheduled future change only; it is not applied to a current 2026 result.