Salary sacrifice crackdown: How Rachel Reeves’ UK Budget 2025 pension tax raid could hit millions of workers
26 November 2025 Chancellor Rachel Reeves is hours away from delivering her second Budget – and one idea is dominating the headlines this morning: a clampdown on salary sacrifice for pensions that critics are already calling a “stealth tax” on workers’ retirement savings. According to multiple briefings, Reeves is expected to cap the amount of pay people can divert into pensions via salary sacrifice while escaping National Insurance, with the limit widely tipped to be set at £2,000 a year.The Guardian+2Sky News+2 The move is part of a wider pensions tax package that could raise more than £3bn a year,