The minimum contributions that employers and their staff must pay into their automatic enrolment workplace pension scheme has increased from 6th April 2019.
All employers with staff that are enrolled in the workplace pension scheme must ensure that they are implementing the changes and that at least the new minimum amounts are being paid into their pension schemes. This applies whether it was through an automatic enrolment pension scheme or using an existing scheme.
- The employers minimum contribution has risen from 2% to 3%
- The employees minimum contribution has risen from 3% to 5%
The increase means that the total contributions for employees have gone up from 5% to 8%.
The changes do not apply if you are using the defined benefits scheme wherein your workplace pension is based on your salary and how long you have worked for your employer.
It is also important to note that non-earners can still pay £2,880 a year into a pension and receive 20% extra to their contribution in tax relief.