The minimum amounts to be paid into employee’s workplace pensions is set to increase from 6 April 2019, and employers are responsible for making sure these increases are implemented and for advising their employees of the changes.
This increase applies to all employers with staff in auto enrolment pension schemes, or those who decided to use an existing scheme.
Currently employer’s must pay in at least 2% and employees at least 3% of the qualifying salaries into the scheme. From April 2019, this will increase to 3% for employers and 5% for employees. Employers will be allowed to pay more and employees less, providing that the 8% total minimum contribution is reached.
As a reminder the calculation is based on a specific range of earnings. For example for 2018/19 it is between £6,032 and £46,350 per year. Earnings includes salaries, wages, commission, bonuses, overtime, statutory sick pay, statutory maternity pay, statutory paternity pay and statutory adoption pay.
Read our latest fact sheet on "Pensions- Automatic Enrolment" to find out more:-
If you would like to discuss pension auto enrolment and your business, please do get in touch with the DRG payroll team. We would be delighted to hear from you.
For further information, visit The Pensions Regular website
Increase of automatic enrolment contributions
DISCLAIMER: This information is for guidance only, and professional advice should be obtained before acting on any information contained herein. We will not accept any responsibility for loss to any person as a result of action taken or refrained from in consequence of the contents of this publication.