Salary sacrifice into pension to keep child benefit.

[Huntsman]

I salary sacrifice some of my income into my pension so that my gross salary is just under £50k.

I do this because I was previously advised this is tax advantageous into the pension scheme (ie the gross amount goes into the scheme) and because it means we get to keep the £80 a month child benefit.

I changed jobs mid year, but have totted up my gross salary and its about £300 over the £50k, I can sort that my making a increased pension payment in March.

What happens if I get a bonus and that amount tips my gross over the £50k? I could dump all the bonus into the pension? That would prevent me from losing the child benefit?

[Huntsman]

Thanks chaps.

I'll do that, don't really need it, I'd just spend it on stupid st. Like another 7ltr car or some such.

[Huntsman]

Brads67 said:

So whilst making more than 50k a year, you hide some of your wages so that the taxpayer can hand you 80 quid a month in benefits.


Classy.

If you like, yes.

There's a system of clearly defined rules, what I am doing is entirely within that set of rules. Choosing to take less of the money I earn in my pocket now and setting it aside for the future and taking advantage of the government wanting me to do that by making it more tax advantageous to do so. Later in life, I'll be better placed to looked after myself financially and less likely to need support from the state.

[Huntsman]

I never thought the question would cause a mini internet war zone.

At least I got the clarification I wanted.

Thank you.

[Huntsman]

Brads67 said:

My opinion was about making your salary apparently look less in order to claim a benefit you would otherwise not be entitled to due to your high salary.

But the point is that if you salary sacrifice into a pension you are entitled to the child benefit. That has quite deliberately been designed to be that way to encourage people to do it.