Helping NHS Staff to Protect their Futures Against Inflation
If you’re an employer in the NHS, you'll be aware of the challenges faced by your staff when it comes to retirement planning. With the current financial climate putting a strain on staff, it is becoming increasingly difficult for them to save for their futures.
However, there is a solution that can help both you and your staff – salary sacrifice Additional Voluntary Contributions (AVCs).
Salary sacrifice AVCs are a simple yet effective way for NHS staff to boost their pension savings without majorly impacting their take-home pay. This is achieved by deducting contributions from an employee’s gross pay before tax and National Insurance are applied. The employee pays far less tax as a result, which can lead to significant savings over time.
There are a number of benefits to offering salary sacrifice AVCs to your staff:
Recruitment and Retention
By offering salary sacrifice AVCs, trust employers are demonstrating their commitment to supporting staff in improving their future financial security – something highly sought after in the job market.
Salary sacrifice AVCs can provide significant tax savings for both the employee and the employer. By reducing the amount of income tax and National Insurance contributions that the employee pays, they can increase their take-home pay while still contributing to their pension.
But it’s not just the employee who saves – the employer also saves 14.3% of the value of salary sacrifice, which can bring much needed savings for the trust.
Salary sacrifice AVCs can help employees to achieve their retirement goals. With the inflation on the rise, it is becoming increasingly difficult for employees to save adequately for their retirement. By offering this benefit, you are providing your staff with a valuable, tax-efficient tool to help them plan for a comfortable retirement.
For these reasons, it’s highly encouraged that all NHS trusts consider offering salary sacrifice AVCs to their employees as part of their benefits package.