Workplace pensions Autoenrolment rules started in 2012 for larger employers, it was then phased in over 5 years for all employers to comply by 2017 and from 2018 all NEW employers/businesses must comply after starting up.
Currently, workplace pension contributions payable are 3% employer and 5% (includes 1% tax relief) employee of qualifying earnings.
Qualifying earnings are set each year by government for 2020/21 it is the band of earnings between £6,240pa to £50,000pa.
Eligible Workers: eligible for tax relief if they’re under age 75 and
- they have UK earnings that are subject to income tax for the tax year
- they’re resident in the UK at some time during the tax year
- they were resident in the UK at some time during the preceding five tax years and when they joined the pension scheme.
Aged 22 to State Pension Age
- All eligible workers earning £10,000 pa must be automatically enrolled (they can then opt out if they wish within 30 days)
- Non eligible worker earning over £6,240 up to £10,000 pa can ask to be enrolled and IS entitled to Employer Contributions
- Non-eligible worker earning below/up to £6,240 can ask to be enrolled but NOT entitled to Employer Contributions
Below Age 22 or over State Pension Age
- Non eligible worker earning over £6,240 can ask to be enrolled and IS entitled to Employer Contributions
- Non-eligible worker earning below/up to £6,240 can ask to be enrolled but NOT entitled to Employer Contributions