Does Pension Salary Exchange Affect State Pension?

Salary sacrifice isn't for everyone – it's unavailable if it reduces earnings below the minimum wage. ... Entitlement to state benefits eg Statutory Maternity Pay and the State Pension may be affected if your salary falls below the level at which you pay National Insurance contributions.

Will salary exchange affect my State Pension?

Salary sacrifice may affect an employee's entitlement to contribution based benefits such as Incapacity Benefit and State Pension. It may reduce the cash earnings on which National Insurance contributions are charged.

Do salary sacrifice schemes affect pension?

Taking out a salary sacrifice scheme will therefore permanently reduce any pension benefits that you accrue in the 2015 scheme and this must be considered when assessing the benefits of entering such an arrangement.