Could somebody please explain the salary sacrifice scheme to an idiot (me)?

[stressheaderic]

I don't know whether to join the salary scarifice scheme offered by my work (public sector).
My nursery bill is £280 per month. I understand that I will get a voucher for £243 a month, but how better off will I be in real terms?
All I know is that comes out before tax, thusmaking your salary appear lower, so I will be paying less tax and therefore picking up a bit more wages, is this right?
I currently work 3 days a week.

Can anyone tell me how it works, in very very simple terms??

Assuming you are a standard rate tax payer then a £243 voucher will only reduce your monthly salary by around £170. This is because the voucher is taken out of your salary before it is taxed so your taxable salary is less and thus you pay less tax than before you signed up.

So you will be saving around £70 per month.

Ah thanks NeilsBoar, that's really useful - still in two minds whether to do it or not, some people say not to as it affects pension contributions but least I understand how much I'll be better off by now.

I was going to mention pensions but it seems like you know already. My Unison rep said not to do it because of the pension, you'll be better off now but long term it will cost you a lot more than you save.

If you are on a final salary pension then it will not be affected, unless you are planning on retiring while you are still in the salary sacrifice scheme.

that's about the size of it - you save whatever tax you would pay on £243, but your employer will contribute £243 contribution rate less to your pension - so if one is less than t'other it makes sense (on money purchase schemes - I know less than nothing about final salary pensions because I have never had one ever). If you are close to contribution threshold, it may or may not make sense. It makes lots* of sense for DH and I, FWIW.

no idea how that all came out in bold

Does salary sacrifice affect redundancy payments too?

Am also trying to decide if it's worth joining salary scarifice scheme offered by my work. Am in public sector too and we have massive redundancies looming later this year so didn't want to jeopardise any potential redundancy payout.