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Posted Fri, 08 Dec 2023 18:46:33 GMT by
Assuming an employee with salary 200000. This employee has set up a salary sacrifice arrangement with their employer for the workplace pension. Under this engagement, 10% of the employee's salary is sacrificed and goes to pension. On top of this, the employeer also contributes to the pension another 10%. There's no contributions via SIPP. So in the end: Gross salary: 200.000 Taxable salary 180.000 Ends up in pension total: 40.000 via salary sacrifice. The payment to the pension provider is exlusively by the employer, but it consists of 20k from employee gross and 20k from employer outside gross. I would like to understand how the two components of salary sacrifice affect the threshold and adjusted income calculations. More specifically, I am not sure if the 20k from employer contributions affects any of these calculations.
Posted Fri, 15 Dec 2023 08:46:05 GMT by HMRC Admin 25 Response
Hi George43,
Please refer to guidance here:
Pensions tapered annual allowance Published 8 July 2015
Thank you. 

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