Nearly a third (30 per cent) of do-it-yourself (DIY) investors would opt in to use salary sacrifice to boost their pension savings or mitigate against National Insurance contribution (NIC) costs, analysis from Charles Stanley Direct has revealed.

Of those considering salary sacrifice, 20 per cent said their employer already offers salary sacrifice, and although they don’t use it currently, they will, while 10 per cent said their employer currently does not offer salary sacrifice, but if they were to introduce it, they would use it.

In total, 59 per cent of respondents said that they currently use or plan to use salary sacrifice (59 per cent), with more than half (51 per cent) stating that they use it, or will use it, to boost their pension pot for retirement.

In addition to this, a third (33 per cent) are looking to use it to pay less NICs, while 29 per cent expect salary sacrifice to put them into a lower income tax bracket.

Chancellor, Rachel Reeves, previously announced plans to increase the rate of employer NIC from 13.8 per cent to 15 per cent, in a move that industry experts warned could represent a “major setback” to hopes of progress on Britain’s under-saving crisis.

Industry experts have since suggested that employers may be able to use salary exchange as a way to mitigate the additional costs they are set to face as a result of the increase in employer NIC.

This was echoed by Charles Stanley Direct financial planner, Lisa Caplan, who said that, following the Chancellor’s decision to raise employer contributions to National Insurance, the attraction of salary sacrifice has grown "markedly".

“It gives employees the chance to bolster their pension savings while reducing tax liabilities, which employers also benefit from," she stated.

However, Caplan warned that, with 15 per cent of those surveyed saying their employers don’t offer salary sacrifice, there’s a chance that many businesses "may be missing a trick".

But the research also found that while 60 per cent of DIY investors said their employer already offers salary sacrifice, less than a third (29 per cent) currently use salary sacrifice schemes from their employer.

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