Payrolls where auto enrolment contributions are being paid will have increased contributions from April 2018.
In order to comply with Auto Enrolment duties, minimum levels of pension contributions have to be paid by the employer and by the employees to the Workplace Pension Scheme.
These contributions are due to increase in line with legislation, with the first contribution increase to take effect from 6th April 2018.
The table below shows the current minimum pension contributions payable and the increases which need to be made from 6th April 2018. Contributions are based on Qualifying Earnings.
Qualifying Earnings are currently calculated based on earnings between £5,876 and £45,000 per year (£490 to £3,750 per month, or £113 to £866 per week)*, and include certain elements of pay such as salary or wages, commission, bonuses, overtime and statutory payments.
Date effective
|
Minimum employer contribution |
Minimum total contribution
|
Employee contribution if employer contributes at minimum level
|
Until 5 April 2018 |
1% |
2% |
1% |
Increased contributions from 6 April 2018 |
2% |
5% |
3% |
The above means that if for example, the employer and the employees are both currently paying the minimum contributions of 1%, the Employer’s contribution must increase to 2% with the Employee’s contribution increasing to 3% from 6th April 2018.
Further legislative increases are due from 6th April 2019.