Salary Sacrifice Calculator

Q: Is salary sacrifice worth it?

It depends on your tax rate. In Australia, money you sacrifice is taxed at 15% inside super. If your marginal tax rate is 30%, 37% or 45%, you save the difference. If you earn under $45,000, your rate is only 16% plus the Medicare Levy, so the gain is small and after-tax contributions may pay you more through the government co-contribution. In the UK, salary sacrifice is almost always worth it because you save National Insurance on top of the tax relief you already get.

Q: How much can I salary sacrifice into super each year?

The concessional cap is $30,000 for 2025–26. This cap counts everything paid in before tax, including your employer's 12% Super Guarantee. So if your employer pays $11,400, you have $18,600 of room left to sacrifice.

Q: What happens if I go over the concessional contributions cap?

The ATO adds the excess to your taxable income and taxes it at your marginal rate. You get a 15% tax offset for the tax already paid by your fund, plus an interest charge. You can then choose to pull up to 85% of the excess out of super to help pay the bill, or leave it in and it counts toward your non-concessional cap.

Q: Can I use unused concessional cap from earlier years?

Yes. This is called carry-forward. You can use unused cap from the past five financial years if your total super balance was under $500,000 on 30 June of the year before. It is handy in a year when you sell an asset or get a bonus and want a bigger deduction.

Q: Does salary sacrifice reduce my HECS-HELP repayments?

No. Your student loan repayment is based on repayment income, which adds your reportable employer super contributions back on top of your taxable income. Salary sacrifice lowers your taxable income but not your repayment income, so your HECS-HELP bill stays the same.

Q: Does salary sacrifice affect Centrelink or Family Tax Benefit?

No, it does not help you get more. Centrelink and the ATO use adjusted taxable income, which adds back reportable employer super contributions. Salary sacrifice is included in that add-back, so payments like Family Tax Benefit and Child Care Subsidy are worked out on the same income as before.

Q: Can my employer cut my Super Guarantee if I salary sacrifice?

No. Since 1 January 2020, the law says your employer must work out the 12% Super Guarantee on your full salary before any sacrifice. Sacrificed amounts also cannot be used to count towards the employer's SG duty.

Q: Is salary sacrifice better than claiming a tax deduction for a personal super contribution?

The tax result is almost the same. Both are concessional contributions taxed at 15% and both count towards the $30,000 cap. Salary sacrifice: the tax saving happens in each pay, so your take-home pay is smoother. Personal deductible: you pay from your bank account, then claim it at tax time. More flexible, but you must send your fund a notice of intent form and get it acknowledged before you lodge.

Q: Can I stop or change my salary sacrifice?

Yes. It is an agreement with your employer, so you can change or stop it. But the change must be made before you earn the pay. You cannot sacrifice money you have already earned, so check your employer's notice period and payroll cut-off dates.

Q: Does salary sacrifice affect my UK State Pension?

Usually not. You still build a qualifying year as long as your pay after sacrifice stays above the lower earnings limit. Problems only start for low earners whose reduced salary drops under that level, so most employers set a floor to stop this.

Salary Sacrifice Calculator

Introduction

Salary sacrifice is a simple deal with your employer. You give up some of your pay before tax, and that money goes straight into your super (Australia) or pension (UK) instead. Because the money is taken out before tax, you often pay less tax and end up better off overall.

Enter your salary, how much you want to sacrifice, and your employer's contribution. This salary sacrifice calculator then compares two paths side by side so you can see which one leaves you with more.

For Australia (2025–26): it compares salary sacrifice against making after-tax contributions. It works out your PAYG tax, Medicare Levy, the Low Income Tax Offset, the 15% contributions tax, Division 293 tax, the government co-contribution, and LISTO. It also shows how much of your $30,000 concessional cap you have used.

For the UK (2025–26): it compares your pay before and after sacrifice. It works out your income tax, employee National Insurance, employer National Insurance, and your total pension contributions. You can pick Simple sacrifice (keep the NI saving as cash) or SMART sacrifice (put the NI saving into your pension), and set how much of the employer NI saving is passed on to you.

The results come as tables, a chart, and a step-by-step breakdown of every calculation. Change the amounts to see how much extra could land in your retirement savings each year.

How to use our Salary Sacrifice Calculator

Enter your salary, how much you want to put into super or a pension, and a few details about your employer's contributions. The calculator shows your take-home pay, your total super or pension, the tax you save, and a step-by-step breakdown.

Jurisdiction: Pick Australia or United Kingdom. This sets the tax rules, the currency, and which fields you see.

Gross (before-tax) salary: Type your pay before any tax or deductions. In Australia you can also pick per week, fortnight, month, or year.

Employee salary sacrifice contribution: Choose "% of Salary" or "Fixed Amount", then enter how much of your before-tax pay goes into your super or pension.

Age (Australia only): Enter your age. It is used to check if you can get the Government Co-Contribution and LISTO.

Sacrifice mode (UK only): Pick Simple Sacrifice to keep your National Insurance saving as extra pay, or SMART Sacrifice to put that saving into your pension.

Employer SG rate / employer pension rate: Enter what your employer pays in. In Australia the default is the 12% Super Guarantee. In the UK, enter your employer's pension rate or a fixed amount.

Employer NI saving pass-through (UK only): Enter the share of your employer's National Insurance saving that they add to your pension, from 0% to 100%.

Convert employee NI savings to pension (UK only): Choose "Yes" to send your own National Insurance saving to your pension, or "No" to keep it as take-home pay.

Calculate and Reset: Results update as you type, but you can click Calculate to refresh them. Click Reset to go back to the default values.

What Is Salary Sacrifice?

Salary sacrifice is a deal between you and your employer. You give up part of your pay before tax is taken out. That money goes straight into your super fund (Australia) or your pension (United Kingdom) instead of your bank account. Because the money never counts as normal pay, you pay less tax on it.

How Salary Sacrifice Works in Australia

In Australia, sacrificed pay goes into your super. It is taxed at just 15% inside the fund. If your normal tax rate is 30%, 37% or 45%, that is a big saving. These are called concessional contributions.

Concessional cap: You can put in $30,000 a year from before-tax money. This cap includes your employer's Super Guarantee (SG) payments. Go over the cap and the extra is taxed at your normal rate.
Super Guarantee: Your employer must pay 12% of your salary into super in 2025–26. Salary sacrifice should not cut this amount.
Division 293 tax: If your income plus your contributions is over $250,000, an extra 15% tax applies to some of those contributions.
Government Co-Contribution: If you earn less, adding money from your after-tax pay can earn you up to $500 free from the government. Salary sacrifice does not get this.
LISTO: If you earn $37,000 or less, the government can refund up to $500 of the 15% contributions tax.

This is why salary sacrifice is not always the winner. For low earners, after-tax contributions plus the co-contribution can beat it. For middle and high earners, salary sacrifice usually comes out ahead.

How Salary Sacrifice Works in the United Kingdom

In the UK, you swap part of your salary for a bigger pension payment from your employer. Your pay drops on paper, so you pay less National Insurance (NI). You already get tax relief on pension payments, so the NI saving is the real bonus.

Employee NI saving: You save 8% on pay between £12,570 and £50,270, and 2% above that.
Employer NI saving: Your boss saves 15% NI on the sacrificed amount. Many employers add some or all of this to your pension. That is called pass-through.
Simple vs SMART: With simple sacrifice you keep your own NI saving as extra take-home pay. With SMART sacrifice, that saving goes into your pension too.
Annual allowance: Most people can put £60,000 a year into a pension before extra tax charges start.

Things to Watch Out For

Salary sacrifice locks your money away until you can access your super or pension. A lower gross salary can also affect loan applications, sick pay, redundancy pay, and some government payments that are based on income. Always check the rules with your employer and your fund before you start.

Formulas used

Australian PAYG tax (marginal tax less LITO plus Medicare levy)

\text{PAYG} = \max\!\left(0,\; \sum_i r_i \times A_i - \text{LITO}\right) + \text{Medicare}

Medicare levy (2% with shade-in)

\text{Medicare} = \begin{cases} 0, & TI \le 27{,}222 \\ 0.10 \times (TI - 27{,}222), & 27{,}222 < TI < 34{,}027 \\ 0.02 \times TI, & TI \ge 34{,}027 \end{cases}

Concessional contributions tax including Division 293 surcharge

T_{\text{contrib}} = 0.15 \times C_{\text{conc}} + 0.15 \times \min\!\big(C_{\text{conc}},\; \max(0,\; TI + C_{\text{conc}} - 250{,}000)\big)

Government co-contribution

\text{Co} = \min\!\left(0.5 \times C_{\text{after-tax}},\; \max\!\left(0,\; 500 - (I - 47{,}488)\times \frac{500}{15{,}000}\right)\right),\quad \text{age} < 71

Net super contributions (salary sacrifice strategy)

\text{Net Super} = C_{\text{conc}} - T_{\text{contrib}} + C_{\text{after-tax}} + \text{Co} + \text{LISTO}

Combined position and strategy difference (Australia)

\Delta = \big(\text{TakeHome}_{SS} + \text{NetSuper}_{SS}\big) - \big(\text{TakeHome}_{AT} + \text{NetSuper}_{AT}\big)

UK income tax with tapered personal allowance

PA = \max\!\left(0,\; 12{,}570 - \frac{\max(0,\, I - 100{,}000)}{2}\right),\quad \text{Tax} = \sum_i r_i \times B_i,\; r_i \in \{0.20, 0.40, 0.45\}

UK National Insurance and total salary sacrifice benefit

NI_{ee} = 0.08\,\big(\min(S,50{,}270)-12{,}570\big)^{+} + 0.02\,(S-50{,}270)^{+},\quad \text{Benefit} = \Delta\text{TakeHome} + \Delta\text{Pension}

Frequently asked questions

Is salary sacrifice worth it?

It depends on your tax rate. In Australia, money you sacrifice is taxed at 15% inside super. If your marginal tax rate is 30%, 37% or 45%, you save the difference. If you earn under $45,000, your rate is only 16% plus the Medicare Levy, so the gain is small and after-tax contributions may pay you more through the government co-contribution.

In the UK, salary sacrifice is almost always worth it because you save National Insurance on top of the tax relief you already get.

How much can I salary sacrifice into super each year?

The concessional cap is $30,000 for 2025–26. This cap counts everything paid in before tax, including your employer's 12% Super Guarantee. So if your employer pays $11,400, you have $18,600 of room left to sacrifice.

What happens if I go over the concessional contributions cap?

The ATO adds the excess to your taxable income and taxes it at your marginal rate. You get a 15% tax offset for the tax already paid by your fund, plus an interest charge. You can then choose to pull up to 85% of the excess out of super to help pay the bill, or leave it in and it counts toward your non-concessional cap.

Can I use unused concessional cap from earlier years?

Yes. This is called carry-forward. You can use unused cap from the past five financial years if your total super balance was under $500,000 on 30 June of the year before. It is handy in a year when you sell an asset or get a bonus and want a bigger deduction.

Does salary sacrifice reduce my HECS-HELP repayments?

No. Your student loan repayment is based on repayment income, which adds your reportable employer super contributions back on top of your taxable income. Salary sacrifice lowers your taxable income but not your repayment income, so your HECS-HELP bill stays the same.

Does salary sacrifice affect Centrelink or Family Tax Benefit?

No, it does not help you get more. Centrelink and the ATO use adjusted taxable income, which adds back reportable employer super contributions. Salary sacrifice is included in that add-back, so payments like Family Tax Benefit and Child Care Subsidy are worked out on the same income as before.

Can my employer cut my Super Guarantee if I salary sacrifice?

No. Since 1 January 2020, the law says your employer must work out the 12% Super Guarantee on your full salary before any sacrifice. Sacrificed amounts also cannot be used to count towards the employer's SG duty.

Is salary sacrifice better than claiming a tax deduction for a personal super contribution?

The tax result is almost the same. Both are concessional contributions taxed at 15% and both count towards the $30,000 cap.

Salary sacrifice: the tax saving happens in each pay, so your take-home pay is smoother.
Personal deductible: you pay from your bank account, then claim it at tax time. More flexible, but you must send your fund a notice of intent form and get it acknowledged before you lodge.

Can I stop or change my salary sacrifice?

Yes. It is an agreement with your employer, so you can change or stop it. But the change must be made before you earn the pay. You cannot sacrifice money you have already earned, so check your employer's notice period and payroll cut-off dates.

Does salary sacrifice affect my UK State Pension?

Usually not. You still build a qualifying year as long as your pay after sacrifice stays above the lower earnings limit. Problems only start for low earners whose reduced salary drops under that level, so most employers set a floor to stop this.

Can salary sacrifice take my pay below the National Minimum Wage?

No. UK employers cannot let a sacrifice push your cash pay under the National Minimum Wage or National Living Wage. Payroll will cap or refuse the sacrifice if it would break that rule.

Does salary sacrifice reduce UK student loan repayments?

Yes. Unlike Australia, UK student loan repayments are based on your gross pay after the sacrifice. A lower salary means a lower repayment, so sacrifice saves you tax, National Insurance and loan repayments at once.

Does salary sacrifice help with the £100,000 personal allowance trap or child benefit charge?

Yes, and this is where the saving is biggest. Sacrifice lowers your adjusted net income. Bringing income back under £100,000 restores your full £12,570 personal allowance, where the effective tax rate is about 60%. Getting under £60,000 also cuts or clears the High Income Child Benefit Charge.

How does salary sacrifice affect maternity pay in the UK?

Statutory Maternity Pay is based on your average earnings in the eight weeks before the qualifying week, and that is your reduced salary. So a sacrifice running at that time can lower your SMP. On the plus side, your employer must keep paying the full pension contribution during paid maternity leave.

Will salary sacrifice hurt my chances of getting a mortgage?

It can. Lenders look at your gross salary, and sacrifice makes that number smaller. Some lenders will add the pension or super sacrifice back when they assess you, others will not. If you are applying for a home loan soon, ask your broker first and think about pausing the sacrifice.

Is salary sacrifice the same as salary packaging?

Not quite. Salary sacrifice into super is one type of packaging. Salary packaging is the wider term and can cover cars under a novated lease, work laptops, phones and, for charity or hospital staff, everyday expenses. Non-super items may trigger Fringe Benefits Tax for your employer.

Can I still salary sacrifice after age 67 or 75?

Yes, up to a point. From 67 to 74 your fund can accept employer and salary sacrifice contributions while you are working. Once you turn 75, funds can only accept Super Guarantee and downsizer contributions. Salary sacrifice must stop after the 28th day of the month you turn 75.

When can I actually get the money back?

Not for a long time. In Australia, super is locked until you reach preservation age, which is 60 for anyone born after June 1964, and you meet a condition of release like retiring. In the UK, you can normally take a pension from age 55, rising to 57 in April 2028. Only sacrifice what you can live without.

Your Salary Sacrifice Results

Rate this calculator

Introduction

How to use our Salary Sacrifice Calculator

What Is Salary Sacrifice?

How Salary Sacrifice Works in Australia

How Salary Sacrifice Works in the United Kingdom

Things to Watch Out For

Formulas used

Frequently asked questions

Is salary sacrifice worth it?

How much can I salary sacrifice into super each year?

What happens if I go over the concessional contributions cap?

Can I use unused concessional cap from earlier years?

Does salary sacrifice reduce my HECS-HELP repayments?

Does salary sacrifice affect Centrelink or Family Tax Benefit?

Can my employer cut my Super Guarantee if I salary sacrifice?

Is salary sacrifice better than claiming a tax deduction for a personal super contribution?

Can I stop or change my salary sacrifice?

Does salary sacrifice affect my UK State Pension?

Can salary sacrifice take my pay below the National Minimum Wage?

Does salary sacrifice reduce UK student loan repayments?

Does salary sacrifice help with the £100,000 personal allowance trap or child benefit charge?

How does salary sacrifice affect maternity pay in the UK?

Will salary sacrifice hurt my chances of getting a mortgage?

Is salary sacrifice the same as salary packaging?

Can I still salary sacrifice after age 67 or 75?

When can I actually get the money back?

Salary Sacrifice Calculator

Your Salary Sacrifice Results

Rate this calculator

Introduction

How to use our Salary Sacrifice Calculator

What Is Salary Sacrifice?

How Salary Sacrifice Works in Australia

How Salary Sacrifice Works in the United Kingdom

Things to Watch Out For

Formulas used

Frequently asked questions

Is salary sacrifice worth it?

How much can I salary sacrifice into super each year?

What happens if I go over the concessional contributions cap?

Can I use unused concessional cap from earlier years?

Does salary sacrifice reduce my HECS-HELP repayments?

Does salary sacrifice affect Centrelink or Family Tax Benefit?

Can my employer cut my Super Guarantee if I salary sacrifice?

Is salary sacrifice better than claiming a tax deduction for a personal super contribution?

Can I stop or change my salary sacrifice?

Does salary sacrifice affect my UK State Pension?

Can salary sacrifice take my pay below the National Minimum Wage?

Does salary sacrifice reduce UK student loan repayments?

Does salary sacrifice help with the £100,000 personal allowance trap or child benefit charge?

How does salary sacrifice affect maternity pay in the UK?

Will salary sacrifice hurt my chances of getting a mortgage?

Is salary sacrifice the same as salary packaging?

Can I still salary sacrifice after age 67 or 75?

When can I actually get the money back?

Related Finance calculators

401k Calculator

Military Retirement Calculator

Retirement Calculator

RMD Calculator

Roth IRA Calculator

Social Security Break-Even Calculator

Social Security Calculator

TSP Calculator