Teachers pension options with vehicle salary sacrifice
So I’m in the TPS - joined 2017 so career average only. Currently a higher rate tax payer after current pension is taken out.
My school have signed up to the Octopus vehicle salary sacrifice. I’m thinking about getting a car through the scheme to reduce my adjusted net income and therefore hopefully bringing myself down into the basic rate tax threshold. However, I’m worried about my pension contributions as this will result in Lower employee and employer contributions per month. I have contacted teachers pension and they have told me that I will be able to make additional salary sacrifice payments into my pension after getting the vehicle to match the previous pension before my salary reduction for the vehicle. I just want to make sure that this is right and see if there’s anyone else who’s been in the same situation before as the salary sacrifice for the vehicle is a great deal, but it reduces the career average pension significantly. I’m hoping by making extra contributions to my pension I’m doing two things: Firstly I am reducing my adjusted income even further, which is making it more likely that I’m a basic rate taxpayer and also saving on more national insurance, and secondly, hoping to not have my pension impacted by topping it up to what it was before. I hope that all makes sense and I appreciate any advice from anyone.
Before people mention that buying a car directly with a dealer might be cheaper I have looked at these options but the salary sacrifice scheme works out significantly cheaper as it includes insurance maintenance tires etc.
Thank you!