Other Salary Sacrifice schemes, including Salary Sacrifice Pensions, follow the same principles.
The maximum amount that any employee can sacrifice is £243 per month or £55 per week.
The following table shows an example of a salary journal with a salary sacrifice:
| Nominal Code | Debit | Credit |
| 7000 - Gross Wages | 2000.00 | |
| 7006 - Employer's NI | 166.78 | |
| 2210 - PAYE | | 250.60 |
| 2211 - National Insurance | | 310.11 |
| 2220 - Net Wages | | 1363.07 |
| 2250 - Childcare vouchers* | | 243.00 |
The following table shows an example of a salary journal without a salary sacrifice:
| Nominal Code | Debit | Credit |
| 7000 - Gross Wages | 2000.00 | |
| 7006 - Employer's NI | 198.02 | |
| 2210 - PAYE | | 299.20 |
| 2211 - National Insurance | | 368.19 |
| 2220 - Net Wages | | 1530.63 |
| 2250 - Childcare vouchers* | | |
* There's no default nominal code for Childcare vouchers. We recommend that you use a nominal code in the Current Liabilities section of the Chart of Accounts, for example 2250.
▼ How this affects the employer In the above example, without the salary sacrifice, the total employer liability is £2198.02 but with the salary sacrifice this reduces to £2166.78. This is because the amount of the employer's NI reduces because of the salary sacrifice.
Along with the usual bank payments for PAYE, NI and net wages, the employer pays the company that administers the childcare vouchers. This company handles distributing the vouchers, either to the employee or directly to the childcare provider.
▼ How this affects the employee In the above example, without the salary sacrifice the employee earns £1530.63. With it, they receive £1363.07 plus £243 in childcare vouchers. Effectively earning £1606.07 due to paying less tax and NI, due to the salary sacrifice.
▼ Management fees Childcare voucher companies charge the employer a management fee. This is usually a percentage of the value of the vouchers and the VAT is at the standard rate.
To record the management fees, post a bank payment to the relevant overhead account using the standard rate tax code, T1 by default.
If you're using Sage 50 Accounts Professional, you can use the Memorise and Recall options to create a skeleton salary journal. To discuss moving to this variant, leave your details and we'll be in touch
- Go to Nominal codes then select Journal entry.
- Enter a reference and the date for the salary journal.
- Enter the relevant details on the Nominal Ledger Journals window, for example:
The balance for the salary journal must equal zero before you can save.
Post the following entry for the value of the vouchers:
| 7000 - Gross Wages | | Debit | |
| 2250 - Childcare vouchers | For further information about salary sacrifice, see the Childcare vouchers salary sacrifice information section above. | | Credit |
- Click Save then click Close.