With a £2,200 gross contribution under relief at source, total pension tax relief is £440. Net cost to you: £1,760 (£147/month). Under salary sacrifice, the effective cost drops further to £1,584.
Use the full calculatorOn a £45,000 income you are a basic-rate taxpayer paying 20% income tax. Your marginal income tax rate is 20%.
Under relief at source, your provider claims the full 20% basic rate relief automatically from HMRC — no Self Assessment needed. Total relief on a £2,200 contribution is £440.
Under salary sacrifice, your gross salary is reduced by £2,200 before income tax and National Insurance are calculated. This saves you income tax and employee NI (saving an additional £176), bringing your effective net cost down to £1,584. Your employer also saves NI of £330 — some employers pass this saving into your pension.
Model your own figures — change income, contribution amount, method or region in the full calculator.
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