As an umbrella employee, there are some benefits available to you that can provide tax and NI savings via your payslip, For example: Pension salary sacrifice and a Cycle to work scheme.
How does salary sacrifice work?
Salary Sacrifice is an agreement to give up some of your gross income which is paid into a workplace pension before any deductions such as employer and employee national insurance contributions (NIC), income tax as an employee and an apprenticeship levy.
This example compares what a Brookson Umbrella Employee could potentially save when putting a proportion of their gross income through Salary Sacrifice.
| £80,000 earnings + £0 pension | £80,000 earnings + £20,000 pension | Gross Income Tax and NI Saving | |
| | £ | £ | £ |
| Total Umbrella Income | 80,000 | 80,000 | |
| Brookson Margin (Umbrella) | (1,300) | (1,300) | |
| Pension Payments | | (20,000) | |
| Employer NICs & Apprenticeship Levy | (8,747) | (6,245) | 2,502 |
| Employee Income Tax & NICs | (18,822) | (11,473) | 7,349 |
| Taxable Income (gross pay) | 69,953 | 52,455 | |
| Take home pay | 51,131 | 40,982 | |
| Total remuneration package (taxable income, pension contributions) | 69,953 | 72,455* | |
| Total remuneration package (take home pay, pension contributions) | 51,131 | 60,982* | |
*Inclusive of lump sum pension
Information is based on our current understanding of taxation legislation and regulations. Any levels and bases of, and reliefs from, taxation are subject to change.
Cycle to work Scheme – How does it work?
As your employer, Brookson is excited to offer you the option of leasing a bicycle and/or equipment through a Hire Agreement, with our chosen partner, the Green Commute Initiative (“GCI”).
On receipt of a deposit from you, equal to the value of the bike, lease payments are made via a salary sacrifice arrangement in monthly instalments over a 12 month period. The deduction is applied to your payroll before calculating Employer Statutory costs, Employee’s NI and PAYE (up to a maximum of 47% depending on your tax band) – so this is a pro-active way of doing your bit for the environment whilst benefiting from tax savings. Your deposit is released to you over the period of the scheme, in quarterly instalments.
Who are the GCI?
Green Commute Initiative is the partner we have chosen to help provide our employees with access to the cycle to work scheme.
As one of very few providers to not be restricted by the normal £1,000 limit, (our maximum is set at £4,000) thanks to them being authorised by the Financial Conduct Authority- this allows us to provide you with significant tax savings on your earnings and provide you with a bicycle at a reduced rate.