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Automatic enrolment – contribution increase from April 18

Posted: October 16, 2017

By law, the automatic enrolment pension contribution is increasing from 6 April 2018, and again from 6 April 2019. Employers must be ready to implement the changes on those days, so it is essential to start planning now to make sure you comply.

As we have previously warned, The Pensions Regulator (TPR) has begun employer spot checks across the UK, so it’s even more important to get everything in place ready for next April.

Contributions for all staff who you have entered your pension scheme will need to be increased. The table below outlines the changes for April 2018 and April 2019:

 

DateEmployer contributionEmployee contributionTotal contribution
Up to 5 April 20181%1%2%
From 6 April 20182%3%5%
From 6 April 20193%5%8%

 

Implementing the increase will require some planning so do not leave this to the last minute.

 

You must inform staff

Employers must also let their employees know about the changes in advance of both dates, and the TPS has provided template letters on their website. The BH Payroll Bureau can of course help with this.

 

Duties for new employers

A change in the law also means that from 1 October 2017, anyone taking staff on for the first time immediately has legal duties to them. These duties apply from the first day of employment, and the first member (and any subsequent members) of staff working for them. New employers then have five months to complete a declaration of compliance for TPR.

 

DID YOU KNOW…

Every three years, employers must automatically enrol staff who initially opted out back into a workplace pension, so it is vital that you continue to maintain accurate staff records.

 

For further information on how your business can benefit from the BH Payroll Bureau, please contact us on 01227 454627, or email payroll@burgesshodgson.co.uk