Question to the HM Treasury:

To ask His Majesty's Government, in the light of their legislative plans to cap salary sacrificed pension contributions, whether both workers and employers will have to pay national insurance on pension contributions above the £2,000 limit, or whether only workers will have to pay additional national insurance.

The Government announced at the Budget last year that salary sacrificed in favour of employer pension contributions will be chargeable to employee and employer NICs from April 2029, but only on amounts exceeding £2,000. This £2,000 threshold ensures that those on higher incomes do not get a disproportionate benefit, whilst protecting lower income employees and their employers making typical contributions.

Saving into a pension, including through salary sacrifice, remains highly tax advantageous. The Government continues to provide over £70 billion of income tax and NICs relief on pension contributions each year.