Auto Enrolment minimum contributions will be increasing again in April.
Currently, the minimum pension contribution is a total of 5% on the standard contribution basis. This will rise to 8% on 6 April 2019, of which employers must pay at least 3% and your staff member must make up the difference.
|Date||Employer minimum contribution||Staff contribution||Total minimum contribution|
|New rate: 6 April 2019 onwards||3%||5%||8%|
|Current rate: 6 April 2018 to 5 April 2019||2%||3%||5%|
It is important to start thinking about these increases and the impact it may have on your payroll costs now. Please note that where your scheme is already in excess of the minimum contribution requirements, no changes are required unless you wish to do so. The Pensions Regulator has provided a calculator to help work out your costs for each employee.
Some pension providers will be writing directly to your employees to notify them of the increase, however, it is good practice for you to communicate this change to your employees as well. The Pensions Regulator has provided a template letter that you may find useful.
If you would like help or advice with your Auto Enrolment payments, please contact our Payroll Bureau team on email@example.com or 01295 250401.