Should you sacrifice your salary?

Salary sacrifice schemes can cut down the amount of tax you pay on your earnings. But are they always a good idea? Sarah Moore investigates.

Whether or not you think it's a good thing that more and more of your colleagues are taking advantage of a "cycle-to-work" scheme and enthusiastically donning their Lycra under their suits, the fact that Chancellor George Osborne has allowed the salary sacrifice scheme to live on following his latest Budget came as a welcome surprise for many, following speculation that it would be cut.

However, don't get too excited. HM Revenue & Customs has reported a 30% rise in the use of salary sacrifice schemes since 2010, and it has been estimated that the Treasury loses an estimated £5bn a year in National Insurance (NI) payments as a result. The government has now said it plans to review these benefits, so it's likely they won't be left alone for much longer. That means if you want to take advantage, you should act now while you still can.

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Sarah is MoneyWeek's investment editor. She graduated from the University of Southampton with a BA in English and History, before going on to complete a graduate diploma in law at the College of Law in Guildford. She joined MoneyWeek in 2014 and writes on funds, personal finance, pensions and property.