Stakeholder v Auto enroll

not enough contributions being paid?

Didn't find your answer?

I have a client who earns approx £100k and is in a stakeholder pension , his employer monthly contributions have just risen to about £250 a  month and his £130;. this seems  low consider considering the autoenrol de minimis , any advice on what to do gratefully received.

Nick

 

Replies (7)

Please login or register to join the discussion.

avatar
By paul.benny
04th Jul 2019 13:10

Don't forget there is a ceiling on earnings on which (auto-enrolment) contributions must be paid.

Thanks (1)
avatar
By Wanderer
04th Jul 2019 13:15

As Paul says maximum (assuming normal arrangements) is currently:-
Employer (gross) £109.65
Employee (net) £146.20

Thanks (1)
avatar
By carnmores
04th Jul 2019 13:44

thanks for reminding me and clarifying the situation. In another company i deal with payroll run through Payroll Manager a decision was made to pay pension contributions on a percentage of total earnings. Given the comments on the maximum contributions we would appear to have exceeded those so my question is is it really a ceiling / maximum or do we look like falling into a non normal arrangement.

Thanks (0)
Replying to carnmores:
avatar
By Wanderer
04th Jul 2019 15:48

The figures I've quoted are not really a maximum / ceiling. It's more of a minimum once you are above a certain salary level.

Thanks (1)
Replying to carnmores:
avatar
By David Heaton
04th Jul 2019 18:22

The AE rules only set a mandatory floor, not a mandatory ceiling. The only ceiling, if you look at it that way, is the annual allowance of £40,000. Given the insignificance of the state pension to someone who has been earning £100k, the client ought probably to be looking at paying much more into the private pension, irrespective of the AE rules, and doing so by employer contribution increases, so that the NI cost is not raised unnecessarily.

Thanks (2)
avatar
By carnmores
04th Jul 2019 20:05

thanks everybody. Moneysoft have confirmed that i can set up another Nest pension (Nest 2) and set that up as a %age of qualifying earnings while the original can continue based on all earnings

Thanks (1)
avatar
By Sarah Newland
10th Jul 2019 11:05

As I understand it, we have a statutory obligation to Auto enroll eligible employees - but they can subsequently opt out or pay any rates they choose - so long as the employer is in agreement of course. (And subject to HMRC limits)

Thanks (1)