Pension contributions are increasing from April 2018
Payroll is one of the most important processes and largest recurring cost to a business. Following the introduction of automatic enrolment for pensions, businesses need to be aware of and prepare for minimum contributions to pensions increasing again in April. Below is a summary of the changes and the actions you need to take to ensure you are ready for the increase.
- Minimum contributions for both employers and employees are increasing in two phases. The first increase must be in place from 6th April 2018 and the second from 6th April 2019.
- These changes apply to all employers with staff in a pension scheme, whether you set up a pension scheme for automatic enrolment or decided to use an existing scheme.
- By law, you have to pay the total minimum contributions and this is split between you and your employees. Employees only have to pay the difference between your contribution and the minimum set, however, they can pay more at their request.
- Minimum contributions to be paid and deadlines are: