What are my options when implementing salary sacrifice?

As a business you have three options to choose from depending on how you want you and your employees to save

Salary exchange/salary sacrifice drives savings for both the employer and the employee. What you and your employees do with these savings will determine who benefits the most and by how much:

Option 1: 'Split benefit' - employers and their employees have more money in their pocket

  • You, the employer, keep the NI savings made by the business as a result of the upgrade
  • Employees use their savings to increase their take-home pay
  • Therefore employees' pension contribution remains the same

This is the standard option used when an employer uses Mintago to upgrade to salary exchange.

Option 2: 'Enhanced split benefit' - employers save on NI and employees boost their pension

  • You, the employer, keep the NI savings made by the business as a result of the upgrade
  • Employees use their savings to increase their pension contributions
  • Therefore employees' take-home pay remains the same

As pension contributions are tax-deductible, both you and the employee end up 'saving' more than in option 1. However, it assumes the employee wants to increase their pension contribution rather than increasing their take-home pay.

Option 3: 'Give back' - employers share/give back their NI savings to employees

  • You, the employer, share or give back the NI savings made by the business as a result of the upgrade
  • Employees use both their savings and the savings you shared from the upgrade to increase take-home pay/pension contributions