Pension Auto Enrolment
Increase in contribution rates from 6 April 2019
A reminder that the minimum contribution rates into your employees’ automatic enrolment pension will be increasing from 6 April 2019.
On 6 April 2018, employers must have increased the amount of their minimum contributions into their employees’ automatic enrolment pension to at least 2% of qualifying earnings. Employees have to pay the shortfall needed to make the total minimum contribution up to 5%, including the employers’ contribution.
The minimum contribution levels will rise again on 6 April 2019, with the employer paying a minimum of 3% towards the pension, and the total minimum contribution reaching 8% – with the member of staff making up the rest.
If the employer pays the same as the minimum total contribution then the member of staff will not need to pay any contributions, unless the scheme rules require a contribution.
Both the employer and staff member can choose to contribute greater amounts to the pension if they wish.
Minimum contributions
Link to The Pensions Regulator:
https://www.thepensionsregulator.gov.uk/en/employers/increase-of-automatic-enrolment-contributions
If you have any questions regarding this, please contact payroll@notjustnumbersltd.co.uk
Three Year re-enrolment
Every three years, you’ll need to re-enrol workers who are eligible for automatic enrolment but aren’t in a qualifying scheme. The Pensions Regulator (TPR) sometimes refers to this as ‘automatic re-enrolment’ or ‘cyclical re-enrolment’. It’s also known as ‘three year re-enrolment’.
This includes workers who’ve previously:
- Stopped making contributions or
- Opted out, without having since opted back in.
Employers are required to:
- Choose a re-enrolment date that falls anywhere within a six-month timeframe. This starts three months before the third anniversary of the date their legal duties began (their staging date or duties start date) and ends three months after it (a staging date of 1 October 2016 would mean the employer could choose to re-enrol between 1 July and 31 December 2019).
- Identify eligible staff, re-enrol them with effect from their chosen re-enrolment date and start contributing to their pension scheme from that date.
- Write to eligible staff individually, within six weeks of their chosen re-enrolment date, to tell them how re-enrolment applies to them.
- Complete a re-declaration of compliance within five calendar months of the third anniversary of the employer’s staging date or duties start date.
Link to The Pensions Regulator:
https://www.thepensionsregulator.gov.uk/en/employers/employers-step-2
If you have any questions regarding this, please contact payroll@notjustnumbersltd.co.uk
Click Here to Download Pension Auto Enrolment Employee Guide
