Increases in minimum contributions for automatic enrolment pensions

Under automatic enrolment, minimum pension contributions are required to increase over time. With effect from 6th April 2018 the total contribution increases from the current minimum of a total contribution of 2% of qualifying earnings, to a total of 5%, and again on 6th April 2019, increasing to a total minimum of 8%.

The employer and the employee can choose to pay more than the minimum contributions if they wish.

Beginning on 6th April 2018, employers may be required to increase the amount of their contributions into their automatic enrolment pension. The total contribution level will be 5%, with the employer paying a minimum of 2% and the employee paying 3%

The contribution levels continue to rise  with effect from 6th April 2019 with the employer paying a minimum of 3% towards the pension and the employee paying 5% to reach the minimum level of 8% contribution.

Date effective Employer minimum contribution Staff contribution Total minimum contribution
Currently until 5 April 2018 1% 1% 2%
6 April 2018 to 5 April 2019 2% 3% 5%
6 April 2019 onwards 3% 5% 8%

More information can be found on The Pensions Regulator website.

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Hazel

Hazel has over 30 years payroll experience, 10 with a UK Top 10 accountancy firm.
Hazel

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