28 Feb Pension Contributions Due To Increase in April 2019
Auto Enrolment Pension Contributions due to increase, in line with legislation, with effect from 6th April 2019.
What is Changing?
Auto Enrolment duties are an important part of all UK businesses, and naturally, UK employers. This means that minimum levels of pension contributions have to be paid by you (the employer), and by your employees. This process happens through your Workplace Pension Scheme.
To update your payroll or payroll software, make sure to contact your payroll service provider directly. They should be able to help you with any queries and ensure a smooth transition.
To assist you, the table below shows the current minimum pension contributions payable. Furthermore, it shows the increases which need to be made from 6th April 2019. Contributions to the Creative Pension Trust are based on Qualifying Earnings. You can calculate Qualifying Earnings based on earnings between £6,032 and £46,350 per year. They include certain elements of pay such as salary or wages, commission, bonuses, overtime and statutory payments.
These rates are expected to change to £6,136 and £50,000 per year, starting from 6th April 2019. This is yet to be confirmed.
For example, as the Employer, you may currently be paying the minimum contributions of 2.00%. This means that the Employer’s contribution must increase to 3.00% from 6th April 2019. Similarly, the Employee’s contribution must increase from the same date to 5.00% from 3.00%.
You may also receive communications from the Pensions Regulator and your payroll provider, advising you to take action. However, these steps are natural, because all employers have to comply with these regulations. If you need help with your accounts, including Payroll, do not hesitate to contact us.
Source: The Creative Pension Trust – www.creativepensiontrust.co.uk
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Alan Davidson is a Chartered Accountant, director and founder of Pentins Business Advisers, entrepreneur and author of the Amazon best-seller “Achieve Your Business Vision”. With over 25 years of helping businesses succeed, Alan knows how to build a business with real value, while avoiding costly mistakes.