15 March 2019
There are a number of changes coming into force from April 2019 that will be important to employers and those managing payrolls. One of the more recent of these, which employers may have overlooked, is the increase to minimum auto-enrolment statutory pension contributions.
From 6 April 2019, the minimum contribution rates for all auto enrolment pension schemes will increase in line with auto enrolment legislation. The new rates are detailed in the table below:
|Date||Employer Minimum Contribution||Employee Minimum Contribution||Total Minimum Contribution|
|6 April 2018 to 5 April 2019||2%||3%||5%|
|6 April 2019 onwards||3%||5%||8%|
In consequence, if the current employer and employee contributions are 2% and 3%, respectively, the company contributions will increase to 3% with effect from 6 April 2019 and employee contributions will increase to 5% on the same date.
If the current scheme is bespoke and contributes less than the 8% total minimum contributions, there will be an increase in total minimum contributions with effect from 6 April 2019. You should review your scheme to ascertain what the increase in company and employee minimum contributions will be.
If the current scheme is bespoke and contributes to (or more than) the 8% total minimum contributions, the company and employee do not need to change the contribution percentages at this stage.
We recommend that employers inform their employees of the changes so that they are aware their take home amounts will change from 6 April 2019.
For further details, please call Paul McMahon on 01915678611, or email email@example.com.
As one of the leading firms of accountants in the North East, with offices in Newcastle, Sunderland and Jarrow, we have the expertise to advise you on a wide range of accountancy, tax and business issues. If you would like to speak to one of our local experts, please call 0191 567 8611 or e-mail firstname.lastname@example.org.