Auto-Enrolment began in October 2012 applying to the larger firms first and rolling out into smaller firms. By 2018 all companies will be required to have all eligible staff auto-enrolled.

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Who qualifies?

• Workers who work under a contract of employment (an employee).

• Aged 22 - State Retirement Age

• Working in UK

• Earning above £10,000*Non eligible workers with earnings over £5876 but under £10000 can ask to be manually enrolled and be eligible for employers contributions. Non eligible workers with earnings less than £5876 can also ask to be manually enrolled but would not be eligible for employers contributions

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What are the contributions?

The current minimum contribution is 2% (1% employee and 1% employer contribution) rising to 8% ( 5% employee and 3% employer contribution) by April 2019.

 

The employee is eligible for tax relief on their contributions, the employer claims this on their behalf from HM Revenue & Customs (relief at source) and adds this to their pensions savings meaning the employee actually pays less (the minimum contribution less the applicable tax relief).

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As an employee you are entitled to 'opt out', however you will be re-enrolled every three years.

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There are a range of different qualifying workplace pension schemes.

 

If you own a business and are nearing your staging date, please contact us to discuss your options.

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The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.

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HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen,

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Auto-Enrolment is currently being reviewed and may change in the near future.

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