Properly handling employer pension contributions is crucial to avoid fines from The Pensions Regulator (TPR).
Here’s what you need to know:
- Deduct contributions from staff salaries and ensure accurate and timely payments to the pension scheme.
- Contact your pension scheme provider or trustees if you’re uncertain about payment amounts and schedules.
- Non-compliance with contributions could result in fines.
- Maintain specific records and payment information.
The contribution amount depends on the pension scheme’s rules. For automatic enrolment, there are minimum contributions required, currently totalling 8% with at least a 3% employer contribution. This timeline might differ depending on the pension provider.
Contributions must be paid to the pension scheme on time. Deduct contributions from staff salaries and pay to the scheme by the 22nd day of the next month (19th if paying by cheque).
Records and Information
Keep accurate records for at least six years, including staff gross earnings and pension contributions due and paid. A copy of all Auto ‘Enrolment communications that need to be sent to the staff (eligibility letters, etc) also needs to be saved.
Pension Fund Limits
Be aware of the maximum amount that can be held in a pension fund without tax charges. Seek guidance from your pension scheme provider or trustees if needed. You can learn more about Pension allowance.
For detailed guidance, our team at Husky will make sure you and your employees will have the financial experience they deserve and ensure compliance and send all communications but also keep an automated audit trail of everything.
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