Salary Diversion, Sacrifice or Exchange Advice: Kent Ashford Maidstone Canterbury

Salary, bonus, commission, company car/ car allowance, profit share & medical insurance are all taxable benefits. If an employer provides them the employee will pay tax and national insurance (NI) on their value. The employer will also pay employer's NI on these benefits.

Salary diversion gets neatly round this fact because if an employer makes a pension contribution on behalf of an employee there is no tax and no NI for the employee, the employer receives full tax relief as an allowable business expense and morevoer the employer pays no employer NI on the pension contribution either.

Thus if an employee gives up (sacrifices) an amount of salary and the employer instead makes a pension contribution on that employee's behalf of a similar amount there will be a saving in employer NI, employee NI and (a modest amount of) income tax. This saving is then available to pay into the employee's pension in addition.

Salary diversion could reduce your entitlement to statutory benefits, means tested benefits, tax credits or other salary related benefits: for example mortgages. So always seek professional advice before action Contact Us for further information.

Salary Diversion Ashford | Salary Diversion Canterbury
Salary Diversion Kent | Salary Diversion Maidstone
Salary Sacrifice Ashford | Salary Sacrifice Canterbury
Salary Sacrifice Kent | Salary Sacrifice Maidstone