Help Centre for Advisers

Are contributions taken before tax and NI?

Our process is defined by HMRC as a “net pay arrangement” and requires the company to take any contributions due from the employee from gross pay before tax. This means the employee’s taxable pay is lowered by the amount of their contribution, resulting in employees getting income tax relief at the highest rate that they pay.

Employer contributions are paid in addition and employees pay no tax on these contributions. National insurance is calculated on pay before pension contributions are taken so there is no impact to how much national insurance is paid unless the employer has chosen to use salary sacrifice.

NOW: Pensions has a good technical infrastructure combined with a pension product suitable for our team. We couldn’t be happier with NOW: Pensions.
Martin Woods, SALT.agency