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Adviser  >  Business Development  >  Salary Sacrifice  >  Salary sacrifice - a better way to save

Salary sacrifice - a better way to save

Salary sacrifice gives you an ideal opportunity to add value to your clients and increase your remuneration. It's an easy, efficient way to improve an employer's benefits package.

In the run up to 2012, salary sacrifice can provide you with a powerful opportunity to drive home the importance and increased value of the work-based pension scheme alternatives to Personal Accounts.

What is salary sacrifice?

It’s an arrangement where employees agree to give up some salary or bonus. The amount given up is used by the employer to provide a non-cash benefit to the employee.

As the employee is being paid less gross salary the employer makes National Insurance Contribution (NIC) savings and the employee pays less tax and NICs.

The benefits

• Employers save on their NIC bill
• Employees save on tax and NICs
• Reinvesting these savings in a pension scheme gives employees a bigger retirement fund
• This gives you an ideal opportunity to add value to your clients and increase your potential remuneration

How we can help?

• Calculator – work out the savings and produce individual employee statements
• Adviser guide – details of how salary sacrifice works and the opportunities it presents (print ready version)
• Employer guide - a step by step guide on how to set up a salary sacrifice arrangement (print ready version)
• Employee guide and personal calculator - showing them the benefits of using salary sacrifice (employee guide - print ready version and personal calculator - print ready version)
• General questions about salary sacrifice - covering common questions on salary sacrifice, how it can be set up, and its effect on state and other employee benefits

Further information?

If you have a question that we haven’t covered, you can e-mail us and we’ll do our best to find out the answer and let you know. We may also update our Questions and Answers.

You can also contact your usual Scottish Life representative for further information.