Guide
Salary Sacrifice Explained
Salary sacrifice means giving up part of gross salary in exchange for a benefit, which usually changes tax and NI.
Quick answer
The key question is not just the gross amount exchanged, but how much tax and NI you stop paying and whether any taxable benefit still applies.
What to check
- Cycle to Work and extra pension sacrifice usually reduce taxable pay directly.
- Holiday buy is often modelled as a pay reduction spread through payroll.
- EV schemes can still create a taxable benefit even when salary is sacrificed.
What to do next
- Use the calculator to model the package directly.
- Check the scheme-specific page for EV, holiday buy, or Cycle to Work.
- Look for employer limits if the post-sacrifice cash pay would become too low.
Try the tool
Use the checker if you already have a payslip. Use the calculator if you want to model take-home pay or salary-sacrifice changes before payday.