Salary sacrifice calculator

Salary sacrifice (sometimes called salary exchange) provides an ideal opportunity to make pension contributions and save on National Insurance. Our easy-to-use salary sacrifice calculator helps show the financial benefits of this, and can work out figures based on a percentage of salary or fixed amount.

Use our pension salary sacrifice calculator to see how you could benefit.

Important information

Legal & General takes no responsibility for how the results from this calculator are used.

The information in this calculator is based on our current interpretation of the law and tax rates, which may change in the future. The value of tax relief will depend on your individual circumstances including where you reside (individuals resident in Scotland and Wales are subject to slightly different tax rates and those are not currently incorporated into the calculator). You can find out more about tax rates at

The value of any money invested in a pension plan can go down as well as up. Any money invested in a pension plan is normally tied up until retirement benefits are taken, which is usually at any time from age 55.

Please note that these calculations are based on rates for English taxpayers. Tax rates may be different depending on where you live within the UK.

Some employers interchange the terms ‘simple’ and SMART for salary sacrifice. The meanings used for the calculator are below:

Simple salary sacrifice (also known as ’standard’)

What is simple salary sacrifice?

Simple salary sacrifice is a way of you paying into your pension and reducing your National Insurance contributions. For example:

You give up a portion of your salary (agreed with your employer) meaning your basic gross salary reduces which, for most people, reduces your National Insurance contributions as your qualifying salary is lower

Save more and reduce tax (SMART)

How does SMART work?

SMART (save more and reduce tax) is a way of paying pension contributions that increases the amount paid into your pension, without reducing take home pay. For example:

  • You give up salary necessary to achieve the same net income as you would have received had you made the same pension contributions to your employer's company registered pension scheme.
  • This amount is then paid into your pension as an employer contribution.
  • you and your employer pay less National Insurance

The National Insurance that you save and any National Insurance saving that your employer is willing to pass on is paid into your pension as an employer contribution

This then means:

  • Your take home pay will remain the same.
  • The total amount contributed to your pension will increase.