Wealth Design News

16/11/18
HMRC have updated their salary sacrifice guidance for advisers and employers. The guidance also reminds of the state benefits that may be affected by salary sacrifice which reduces national insurance contributions below the threshold on which certain state benefits are accrued, for example:
• State pension
• Statutory pay such as statutory sick pay
• Earnings related benefits such as maternity allowance
Also consider if the definition of pensionable salary is based on the pre or post sacrificed amount as this will have an impact on the contributions being paid to a pension scheme. It can be worth reviewing the wording of salary sacrifice arrangements to check that they are operating as expected and can cope with changes such as a change in the level of sacrifice without requiring an amendment to the members contract.