What is salary sacrifice?

Salary sacrifice, also known as salary exchange, is an arrangement between you, as an employer, and your employees, whereby they can opt to give up part of their gross salary, or bonus, in exchange for a non-cash benefit. 

This can be more tax-efficient, enabling both you and your employees to save on National Insurance contributions, depending on the specific benefit.

Why should you offer salary sacrifice benefits to your employees?

By offering an attractive benefits package, including salary sacrifice options, to your employees, you can help boost staff loyalty and attract top talent to your business.  With millennials, who are now considered to make up the majority of the workforce, putting considerable importance on workplace perks and work/life balance, employee benefits have become more valued than ever.

Although employees might at first be wary of agreeing to a salary reduction, the benefits they can receive as a result of salary sacrifice make it worthwhile. In addition, reducing salaries in this way can help some employees further, in certain circumstances. For example, those who earn just over the £50,000 threshold can cut their wages to less than that amount, to continue receiving benefits from the government, like child benefits. Salary sacrifice can also help members of your team looking to delay repaying student loans.‍

Mintago’s salary sacrifice benefits

Mintago offers the UK’s most comprehensive list of salary sacrifice benefits that can enable you and your employees to make substantial savings. These include the following:

Childcare Salary Sacrifice Scheme

The Childcare Salary Sacrifice Scheme enables your employees to pay for nursery fees on a salary sacrifice basis, reducing childcare costs by up to 47%. This results in higher take-home pay for the employee (as a result of paying less Income Tax and National Insurance), and can help to increase productivity and reduce absenteeism.

Cycle to Work Scheme

This is a tax-efficient employee benefit that allows individuals to purchase bicycles and cycling equipment through salary sacrifice, promoting a healthier and eco-friendly commute to work. It enables your employees to save money while encouraging physical activity and reducing carbon emissions. 

Electric Vehicle Scheme

The Electric Vehicle Scheme is a tax-efficient employee benefit that allows your employees to save significant sums on an electric vehicle lease. This is a government-backed benefit that encourages employees to go green and switch to electric vehicles.

Grocery Salary Sacrifice Scheme

Our innovative Grocery Salary Sacrifice Scheme allows your employees to save up to 10% on their groceries, in all major supermarkets.

Gym Benefit

The Gym Benefit enables your employees to pay for their gym membership through salary sacrifice and save 10–40% in the process. 

Holiday Buying Scheme

The Holiday Buying Scheme allows your employees to buy extra leave days through salary sacrifice, providing a cost-effective benefit. You set limits on the number of days purchasable, giving your employees the flexibility to extend their time off, when needed. This initiative offers a valuable perk, enhancing work-life balance for your staff.

Lifestyle Benefit

The Lifestyle Benefit enables your employees to pay for their favourite lifestyle subscription, such as Headspace, Disney+ and Spotify, through salary sacrifice and save 10–40% in the process.

Pension Salary Sacrifice Scheme

Our Pension Salary Sacrifice Scheme enables both you and your employees to make considerable savings. Not only do you pay lower National Insurance contributions, but so do your employees. In addition, they also pay less Income Tax. This means they can save up to 10% of the amount they pay into their pension as a personal contribution.

Tech and Mobile Benefit

This is a salary sacrifice benefit that enables your employees to save 10% on the cost of electronics, white goods and mobile phones, while spreading the cost over 12 months. 

For full details of our salary sacrifice benefits, and how they could save you and your employees money, contact us today.

By Mintago Team
Mintago is an FCA regulated company that helps businesses save on their workplace pension NI costs and improves the financial wellbeing of their employees. For the employer, Mintago provides a salary sacrifice pension hassle-free implementation program which creates direct savings on monthly (National Insurance) NI payments. We manage the whole process including communication, compliance and ongoing management. No need to switch pension provider, either. For the employee, Mintago’s unique financial wellbeing platform helps find lost pensions quickly, manage employee pension contributions, while helping them understand their financial situation with over 1,000 pieces of content.

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