Salary sacrifice pension schemes to be cut by firms after new cap in Budget

Workers will face cuts to pension contributions by employers because of measures announced in Rachel Reeves’ Budget , businesses have warned.

The British Chambers of Commerce, an industry group that represents 50,000 companies, told The i Paper that the Chancellor’s decision to cap salary sacrifice schemes will also lead to lower pay rises and hurt economic growth.

The Chancellor has applied a £2,000 annual limit to the amount of salary that can be sacrificed into pensions without incurring national insurance (NI) payments.

The changes, which come into effect in 2029, will raise £7.3bn, according to the Office for Budget Responsibility, the economic watchdog. New Feature

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In her Commons speech, Reeves said: “That is a pragmatic ste