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YES..You should go for it.
The word 'smart' in connection with a pension scheme is a term that is now given to a scheme where employees make their contribution through what used to be called 'salary sacrifice'. (Of course, you are aware of this.)
Having said this, it is confirmed that the Smart Pensions Scheme can be effective in reducing the NICs liability of the operating employer and of employees who decide to participate.
Though income tax may be same, your Class I NIC liability would be reduced as NICs will be payable only on the reduced salary. NICs will not be payable on the employer contributions to the approved pension scheme as these contributions are specifically disregarded by virtue of paragraph 3 of Part 6 of Schedule 3 to the Social Security (Contributions) Regulations 2001. The NICs saving will equate to the NICs originally due on the amount of salary which is sacrificed.
HOWEVER, there is one disadvantage to it. The scheme benefits themselves may be reduced if they are based on salary, such as the retirement pension, other pension such as widow's and children's and lump-sum death benefits which are often a multiple of salary. It could be that the employer's contribution to the scheme is based on the payroll which has now reduced. Other non-scheme benefits such as bonuses, overtime, redundancy pay and maternity pay may also be adversely affected.All of these problems can be overcome if the company agrees to these items being based on a 'notional salary' which is the salary you would have been receiving before the salary reduction.
APART from this, YES, you can go for this.
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hello, as I only have 2 years to go before retiring how will reduced NIC affect my state pension?.