HHigher rate taxpayers can use the reduction in National Insurance contributions to boost their pensions by £1,300 a year – at no extra cost.
Workers earning between £50,270 and £125,140 a year will save £62.83 a month – £754 a year – after the government cut National Insurance by two percentage points on January 6, from 12 per cent to 10 per cent.
If you use this saving to top up your pension contribution through salary sacrifice (where pension contributions come out of your pre-tax income), you could add an extra £1,300 a year to your pension pot, once tax relief is taken into account, according to Financial Wellbeing and Retirement Wealth Specialist at Work.
National Insurance is paid on employees’ earnings