UK Salary Calculator

HMRC 2026/27 Pension Guide

Pension and Salary Sacrifice Calculator

See how pension savings grow your wealth and cut your tax bill. Use salary sacrifice to avoid the high tax trap. Find out what you keep each month.

Pension Calculator

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£10,000
Drag to optimize income between £100,000 and £125,140 to reverse the 60% Personal Allowance taper.

Statutory Safe Harbor Notice: This calculation models published HMRC 2026/27 tax rates, Class 1 National Insurance thresholds, and Section 35 Income Tax Act 2007 Personal Allowance taper schedules. Pension annual allowances are subject to a £60,000 standard cap and tapered annual allowances above £260,000 threshold income. Consult a qualified pensions or tax advisor for definitive wealth planning.

UK Statutory Pay and Pension Rates

Check mandatory workplace pension rules, earnings limits, and statutory sick or parental leave pay for 2026/27.

Automatic Enrolment Pension Baselines

Component Statutory Minimum Statutory Notes
Employee Minimum 5.0% Includes 1.0% tax relief under relief at source
Employer Minimum 3.0% Calculated on qualifying earnings band
Total Minimum 8.0% Statutory total required by Pensions Act 2008
Qualifying Earnings Lower Limit £6,240 / yr Earnings below this threshold incur no pension liability
Qualifying Earnings Upper Limit £50,270 / yr Earnings above this threshold are uncapped under unbanded schemes
Standard Annual Allowance £60,000 / yr Maximum tax-relieved pension contribution across all sources

Statutory Sick Pay (SSP) & Parental Pay 2026/27

Statutory Benefit Weekly Rate Duration & Rules
Statutory Sick Pay (SSP) £116.75 / wk Payable from day 4 of qualifying illness up to 28 weeks
Statutory Maternity Pay (SMP) — Weeks 1 to 6 90% of AWE 90% of Average Weekly Earnings with no statutory cap
Statutory Maternity Pay (SMP) — Weeks 7 to 39 £184.03 / wk Or 90% of average earnings if lower than statutory rate
Statutory Paternity Pay (SPP) £184.03 / wk Up to 2 consecutive weeks taken within 52 weeks of birth
Statutory Adoption Pay (SAP) £184.03 / wk Matches SMP schedule: 90% for 6 weeks, then statutory flat rate

The Section 35 Income Tax Act 2007 Taper Recovery Proof

Where an individual's adjusted net income exceeds £100,000, Section 35 of the Income Tax Act 2007 reduces their Personal Allowance by £1 for every £2 of excess. Because income in this band is already taxed at 40%, the loss of allowance creates an effective marginal tax rate of 60%:

Teff = Rhigher + ∂PA ∂Y × Rbasic = 0.40 + 0.50 × 0.20 = 0.60 (60%)

Adding 2% Employee Class 1 National Insurance yields an effective rate of 62%. By making gross pension contributions via salary sacrifice or personal pension relief, adjusted net income is reduced below £100,000, capturing a 62% statutory return on every pound saved.

UK Pension Calculator, Salary Sacrifice & Statutory Benefits Synthesis

Workplace pension planning, statutory benefits, and salary sacrifice optimization in the United Kingdom allow earners to reclaim personal allowances and eliminate high marginal tax rates. Our statutory engine calculates pension tax relief, forecasts fund accumulations, and assesses how much weekly wage earnings can be protected. Salary sacrifice exempts contributions from both PAYE income tax and Class 1 National Insurance (NICs), while statutory rules deduct mandatory minimums (5% employee, 3% employer). Between £100,000 and £125,140, HMRC phases out the £12,570 personal allowance; pension contributions restore this allowance, yielding up to 62% in effective statutory tax relief. The framework apportions annual allowances (£60,000 cap), amortizes capital gains tax allowances, levies statutory rates, annualizes child benefit High Income Child Benefit Charge (HICBC) clawbacks, models inside IR35 contractor options, and reviews statutory sick pay and statutory maternity pay thresholds.