Changes to salary sacrifice would cause confusion, reduce benefits to employees, and disincentivise pension savings, the Society of Pension Professionals (SPP) has warned.

It was responding to rumours that HMRC could be planning changes to salary sacrifice for workplace pensions.

The speculation started following HMRC publishing research last week on “Understanding the attitudes and behaviours of employers towards salary sacrifice for pensions.”

The SPP highlighted that the same research indicated that employers are generally very supportive of the arrangement and believe that changes would be negative.

The research showed employers were positive about salary sacrifice and thought it helped to retain employees as part of the overall benefits package.

Some said they passed on the employer NI saving to their employees, but for others it was simply absorbed by the firm as a reduced employment cost.

Steve Hitchiner, chair of the SPP Tax Group, said: “Changing salary sacrifice arrangements would see the extra tax burden hit members and their savings very selectively.

Many in non-contributory schemes, or schemes where employer contributions start from a higher base, would be better off, whereas those who receive a lower employer contribution and seek to remedy that with a salary sacrifice would be worse off.”

He said that more often than not, those whose employer contributions start at a lower amount will be moderate and low earners.

Mr Hitchiner added: “Given the reaction to previous national insurance increases, which is what any changes would amount to, the impact on moderate and low earners, and the likely reduction in pension saving, it is clear that policymakers now have a variety of compelling reasons to leave salary sacrifice arrangements as they are.”

The SPP pointed out that with around a third of private sector employers offering salary sacrifice arrangements, and many public sector organisations doing so too, “they are a well-established and well-functioning feature of the UK pensions landscape.”