Government rushes through NI cap on pension salary sacrifice
The government has already drafted legislation to impose a £2,000 limit on NI exempt pension contributions under salary sacrifice arrangements. What else do we know?
Despite the limits to the amount of salary employees can sacrifice in exchange for tax free employer pension contributions not coming into force until April 2029, the government has already published the National Insurance Contributions (Employer Pension Contributions) Bill. According to media reports, this is due to the government wishing to "reassure the markets" that it is serious about introducing the cap, which is by and large another NI hike for employers.
The Bill does not tell us how the £2,000 cap will operate in practice, e.g. if an individual has two jobs or changes jobs part way through a tax year. It is understood that there will be a consultation in due course to decide on the details and operation of the £2,000 limit.
Related Topics
-
Tribunal rejects reliance on adviser as reasonable excuse
A recent First-tier Tribunal decision has confirmed that relying on an accountant does not automatically amount to a reasonable excuse for missing a self-assessment deadline. The case highlights the limits of delegating tax responsibilities. What does this mean in practice?
-
HMRC issues new wave of offshore “nudge” letters
HMRC has issued a further round of “nudge” letters targeting individuals it believes may have undeclared offshore income or gains. The letters form part of HMRC’s ongoing use of data from international information exchange agreements. What should you do if you receive one?
-
Payroll changes for 2026/27
As the end of 2025/26 draws closer, HMRC has published a raft of updates and reminders for employers. Which changes do you need to be aware of that might impact your payroll in 2026/27?