Publication

LGPS - Salary Sacrifice on Additional Voluntary Contributions

calendar icon 06 February 2026
time icon 3 min

Author

female

Clodagh Boylan

DC Associate Consultant

In the 2025 Autumn Budget it was announced that, from April 2029, any Salary Sacrifice employee pension contributions above £2,000 annually will no longer be exempt from National Insurance Contributions (NICs).

This may impact members within the LGPS who pay Additional Voluntary Contributions (AVCs).

Following the announcement, there has been some confusion and misunderstanding about what it means and its potential impact on members. To help explain the changes, the publication below includes a series of Q&As on topics such as:

  • Does the change affect all LGPS members?
  • What is Salary Sacrifice and how can it benefit LGPS members?
  • How are the benefits of Salary Sacrifice affected by the Autumn 2025 Budget?
  • Will members be able to contribute more than £2,000 in AVCs?
  • How much is this going to impact a member’s take-home pay?
  • Does this change the gross amount of contributions that are paid into the member’s AVC pot?
  • How will this impact employers in the LGPS?
  • How will the proposed change work in practice?
  • Do Hymans offer support in this area? 

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This communication has been compiled by Hymans Robertson LLP® (HR) as a general information summary 
and is based on its understanding of events as at the date of publication, which may be subject to change. It is 
not to be relied upon for investment or financial decisions and is not a substitute for professional advice 
(including for legal, investment or tax advice) on specific circumstances. HR accepts no liability for errors or 
omissions or reliance on any statement or opinion. Where we have relied upon data provided by third parties, 
reasonable care has been taken to assess its accuracy however we provide no guarantee and accept no liability
in respect of any errors made by any third party.
Hymans Robertson LLP is a limited liability partnership registered in England and Wales with registered number 
OC310282. Authorised and regulated by the Financial Conduct Authority and licensed by the Institute and 
Faculty of Actuaries for a range of investment business activities.
© Hymans Robertson LLP 2026. All rights reserved.

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