So you sacrifice your salary so that you don’t pay tax on it, and then you pay tax on it anyway? So what’s the benefit of a salary sacrifice scheme?
What about the pension contributions? Can you deduct those?
I’m struggling to understand adjusted net income calculations, even after reading some of the posts on here so wanted to run through a simple example and hopefully someone can help - figures used are just as an example.
Annual income £105,000
Salary sacrifice pension contribution 9% £9450/year
Salary sacrifice car scheme £800/month, so £9600/year
Is adjusted net income…
Annual salary - salary sacrifice pension contributions - salary sacrifice car = £85950 ?
If not, why not? The deductions are made ‘gross’ so what’s the difference?
The minute my salary hits £100k, I lose tax free childcare and 30h free childcare and it essentially puts my wife out of work for the next 7 years or so because it’d more than wipe her salary out, so we’d be considerably ‘worse off’ than if I earned just £1 less. It’s staggering!