18 November 2025, LONDON \u2013<\/b><\/p>
An average earner who is currently putting away a recommended 15% on a salary sacrifice pension scheme (12% personal and 3% employer contributions) could lose \u00a3215 from their yearly take-home pay with the new \u00a32,000 cap, according to new analysis by personal finance comparison site Finder.<\/p>
The new policy, set to be introduced in April 2029, would see someone on take-home pay of \u00a352,270 impacted most, losing \u00a3341.80 per year if they contributed 12% and their employer 3%. This is a result of the national insurance rate being 8% up to the higher tax threshold and 2% thereafter. <\/p>
If that person contributed 20% total via salary sacrifice (17% personal and 3% employer), they would see their annual take-home pay go down by a significant \u00a3550.87.<\/p>
Experts recommend saving at least 15% into your pension for a healthy retirement pot, especially if you are 30 or older. There are concerns that the cap will discourage people from saving from retirement. <\/p>
Someone on a salary of \u00a339,039 – the UK\u2019s average in 2025 – would see the same difference in take-home pay from the salary sacrifice cap (\u00a3215) as someone earning just over \u00a3106,000 a year and contributing the same percentage of their salary. <\/p>
Meanwhile, someone on a salary of \u00a375,000 a year saving the same amount as the examples above will only see their take-home pay reduced by \u00a3140 as a result of the salary sacrifice cap. <\/p>
George Sweeney, investing and pensions expert at personal finance comparison site Finder, said:<\/b><\/p>
\u201cFor a Budget where the broadest shoulders are supposed to bear the biggest burden, it’s surprising that regular working people – basic-rate taxpayers and middle-earners – will take the worst hit on their take-home pay with the new salary sacrifice cap.\u201d<\/p>
\u201c7.7 million workers in the UK contribute to their pensions via salary sacrifice, so it\u2019s not just a small number of wealthy individuals who are taking advantage of the scheme to save for their retirement\u201d<\/p>
\u201cI am concerned that introducing this new \u00a32,000 salary sacrifice threshold could skew the long-term pension savings habits among ordinary people, as some may opt to reduce their contributions to avoid paying this extra NI or at least minimise its impact.\u201d<\/p>","protected":false},"excerpt":{"rendered":"
An average earner who is currently putting away a recommended 15% on a salary sacrifice pension scheme (12% personal and 3% employer contributions) could lose \u00a3215 from their yearly take-home pay with the new \u00a32,000 cap, according to new analysis by personal finance comparison site Finder.<\/p>\n","protected":false},"author":1312,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"apple_news_api_created_at":"","apple_news_api_id":"","apple_news_api_modified_at":"","apple_news_api_revision":"","apple_news_api_share_url":"","apple_news_cover_media_provider":"image","apple_news_coverimage":0,"apple_news_coverimage_caption":"","apple_news_cover_video_id":0,"apple_news_cover_video_url":"","apple_news_cover_embedwebvideo_url":"","apple_news_is_hidden":"","apple_news_is_paid":"","apple_news_is_preview":"","apple_news_is_sponsored":"","apple_news_maturity_rating":"","apple_news_metadata":"\"\"","apple_news_pullquote":"","apple_news_pullquote_position":"","apple_news_slug":"","apple_news_sections":[],"apple_news_suppress_video_url":false,"apple_news_use_image_component":false,"footnotes":""},"categories":[3788],"tags":[],"asset_tag":[],"class_list":["post-569603","post","type-post","status-publish","format-standard","hentry","category-media"],"apple_news_notices":[],"yoast_head":"\n