L&G is launching an online calculator for advisers to help them highlight to customers the reasons for salary sacrifice.
The calculator performs a basic salary sacrifice operation showing the impact of reducing remuneration, and also works out how much more a client could surrender from their salary to up pension contributions with no compromise in take-home pay.
L&G savings business development director Jamie Vale says: "Salary Sacrifice is already becoming more popular among sizeable employers to increase pension contributions for their employees at no extra cost as the savings from national insurance and taxable income fund the extra pension payments.
The employer's saving in National Insurance contributions can also be passed on, in full or in part, he says.
"Advisers can show clients how a SMART salary will work for them with tax savings resulting in higher pension contributions.
"Salary sacrifice is an essential tool in any financial adviser's toolbox and this will become even more so from 6 April 2010 when we will see the impact of the reduction in Personal Allowance for those whose total income is over £100,000," adds Vale.
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