Minimum pension contributions will soon be increasing - It's time for you to take action

The minimum pension contribution rates for eligible workers are increasing in April. If you haven’t already, it’s time to take action and to start paying at least the minimum amount.

Remember, it’s your responsibility to make sure these increases are implemented into your auto enrolment workplace pension scheme. There could be fines from The Pension Regulator if this is not met.

When will the pension contributions increase?

The first increase must be in place from 6 April 2018 and the second from 6 April 2019. Auto enrolment statutory minimum contributions are detailed below.

Date                                            Employer Minimum contribution            Total Minimum Contribution

Before April 5 2018                                         1%                                     2% (including 1% staff contribution)

April 6 2018 - April 5 2019                              2%                                     5% (including 3% staff contribution)

April 6 2019 onwards                                     3%                                     8% (including 5% staff contribution)

* based on band earnings. Different auto-enrolment minimum contributions apply where earnings are assessed by an alternative method.

Who does this apply to?

All employers must take action to make sure at least the minimum amounts are being paid in. However, you don’t need to take any further action if they are already and will continue, to be paying the increased minimum amounts at the relevant dates or don’t have any staff enrolled in the pension scheme for automatic enrolment.

Prime assists many payroll clients with their auto enrolment requirements and would be happy to discuss this further with you. To contact us please call either 0121 711 2468 or 02476 518 555.