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Salary Sacrifice

The tables below illustrate the savings made when nursery fees are paid through the salary sacrifice scheme.

Please note this example is for demonstration purposes only and do not reflect the current nursery fees

University of Warwick Nursery

Gross costs

  Under 2s Over 2s
Week £283.00 £276.50
Day £56.60 £55.30
     
AM £29.75 £29.10
PM £26.85 £26.20

 

Costs Incurred

(1) Assume a basic rate tax payer, with a child at nursery full-time 5 days per week.

(2)Assume a basic rate tax payer, with a child at nursery full-time 3 days per week.

    (1)       (2)  
Cost              
Age of child <2 2-3 >3   <2 2-3 >3
Days a week in Nursery 5 5 5   3 3 3
Tax Rate of Parent 20% 20% 20%   20% 20% 20%
               
Staff on Salary Sacrifice £ £ £   £ £ £
Cost per annum over 48.4 weeks 13,697 13,383 13,383   8,218 8,030 8,030
Less government funded 15 hrs >>3yr old38 weeks3.17 p hr     1,807       1,807
Tax saving @ 20% 2,739 2,677 2,677   1,644 1,606 1,606
NI Saving @ 12% 1,644 1,606 1,606   986 964 964
Net Costs 9,314 9,100 7,293   5,588 5,460 3,653
               
Effective daily cost 38.49 37.60 30.14   38.49 37.60 25.16
Headline daily cost 56.60 55.30 55.30   56.60 55.30 55.30
Effective saving from salary sacrifice/ gov’t funding 32% 32% 46%   32% 32% 55%

 Please note this is an example and prices used do not reflect the current fees