Employers who have eligible workers in an automatic enrolment pension scheme should be aware that minimum pension contributions increase in April 2019.
The minimum contributions payable, and the relevant dates are shown in the table below:
Key points to note
- Employers can choose to pay more than the legal minimum pension contributions, which could be used to reduce the amount workers contribute, but can’t pay less.
- The type of tax relief applied by the scheme may reduce the actual amount eligible workers need to contribute.
- The new percentage rate will apply from the start of the earnings period.
- The percentage applies to qualifying earnings, or basic salary as decided by the terms of the fund.
What do you need to do now?
- Prepare for any changes to pension contributions to be made in April’s payroll. It is the employer’s responsibility to make sure the right minimum pension contributions are collected and paid for their eligible workers.
- Let your employees know in advance about any increases being applied to their contributions – both from the employer and any increases that will be taken from employees’ pay.
- Make sure you have budgeted for any increased pension contribution.
- Continue to assess everyone who works for you each time you pay them, and enrol anyone who meets the criteria for auto-enrolment, unless they have opted out.
- Remember that you must re-enrol eligible workers every three years.
- If the employer’s and total contributions already meet or exceed the new minimum pension contributions, or if you don’t have any workers in a pension scheme for automatic enrolment, no further action is needed.
If you need help
If you need help with HR administration please do not hesitate to get in touch firstname.lastname@example.org