Tax rises?

[Protagoras]

The main snag is that these contributions would be a percentage of your gross salary, so you'd still be paying employer's NI (and apprenticeship levy) based on that figure. It might still be worthwhile, but I'd need to do some sums after the final rules are published.

Mmm, I'm obviously missing something. "Employer" pension contributions are not currently subject to (a) a maximum limit and (b) employer NI, with the caveat that they're made 'for business reasons'. A LtdCo proprietor can take a salary or £12k and make pension contributions of £60k with no NI paid at all. What I'm getting at is what would prevent an employer offering higher pension contributions with no salary sacrifice and therefore avoiding a SalSac tax limit?

[Protagoras]

The main snag is that these contributions would be a percentage of your gross salary, so you'd still be paying employer's NI (and apprenticeship levy) based on that figure. It might still be worthwhile, but I'd need to do some sums after the final rules are published.

Mmm, I'm obviously missing something.

"Employer" pension contributions are not currently subject to (a) a maximum limit and (b) employer NI, with the caveat that they're made 'for business reasons'.
A LtdCo proprietor can take a salary or £12k and make pension contributions of £60k with no NI paid at all. What I'm getting at is what would prevent an employer offering higher pension contributions with no salary sacrifice and therefore avoiding a SalSac tax limit?

[sadkingbilly]

dunno

[sadkingbilly]

Dunno

[Protagoras]

dunno

That's probably the best budget forecast I've seen!

[woody1]

That's probably the best budget forecast I've seen!

Or the Treasury's answer to the question "how can we boost economic growth?".

[willendure]

https://www.independent.co.uk/news/u...-b2861194.html

"The chancellor is said to be preparing to cap the amount of someone’s salary that can be sacrificed for extra pension contributions before national insurance contributions are incurred to £2,000 a year."

Employee contributions are 8% up to about £50K, then 2% above that.

I wonder how this will work for contractors taking a directors salary and dividends, and paying no NI. I guess whatever you put in your pension will incur NI at 8% to £50K, then 2% up to the £60K limit. I guess we'll find out.

"Also reportedly under consideration is limiting the existing national insurance exemption for employers"

Gen X - we'll never be allowed to retire...

[sadkingbilly]

[

Gen X - we'll never be allowed to retire...

awwww, - diddums

[jamesbrown]

I wonder how this will work for contractors taking a directors salary and dividends, and paying no NI. I guess whatever you put in your pension will incur NI at 8% to £50K, then 2% up to the £60K limit. I guess we'll find out.

Salary sacrifice is a specific mechanism for employees, including umbrella employees (clue is in the name) that saves both the EeNI and ErNI. Employer pension contributions are unlimited, and there is no salary being sacrificed, although CT relief is only available up to £60k and it needs to satisfy the "wholly and exclusively" test, which isn't difficult. There may well be measures that tackle other aspects of pension contributions, including for company directors, but you're confusing two different things.

[Protagoras]

There may well be measures that tackle other aspects of pension contributions, ...

I think there would need to be or there will be very obvious loopholes. However, without tax-free SalSac, umbrella 'employment' will become even less attractive (is that possible?).

There's also the 2p/2p swap proposal doing the rounds. This makes sense because all the 'rich pensioners' on fixed incomes will have more money to spend in the economy ... not!

The budget will be probably be deflationary; reduced demand will reduce prices in the long run, but the only growth I expect to see is the weeds in the garden.