stiscooby

Im currently looking into this and having a meeting with someone in a couple of days but I wonder if someone can give me a couple of pointers in the mean time with regards to workplace pensions (bit of a numpty with this stuff at the moment)...

At the end of last year I got a pay rise at work and at the same time was told they will be enrolling me in a workplace pension and they will be using a certain amount of my new rise to go into the pension.

Now from what i understand with these i can contribute into it too (im not at the moment because i already have my own personal pension) as well as the company but if this isn't "my" contribution and it's just the contribution from the company should this be deducted from my wages??

My latest wage slip showing my new pay increase works out to be what they said my wages was being increased to, minus the pension deduction (if that makes sense) so its what I would be expecting with the pension deduction but there is no mention of pension deduction on my wage slip, so in theory my earnings look less that what they actually are, is this normal?

tubbytommy

iTrader: (20)

i work for a well known union, its now law to contribute a certain amount of your salary to your pension.

your company contributes too but how much is up to them, obviously a minimum amount is required.

you pay the rest and its taken at source. i.e. before you get paid.

the companys contribution wont usually be on pay slip but yours will.

stiscooby

Thanks for the reply.

I will be finding this out but what I'm trying to work out is, the money they have in affect reduced my wages by, are they seeing that as my own personal contribution or theirs/the company?

E.g. If I was to opt out of the pension scheme would they they still have to pay in/would that money come back into my wages?

tubbytommy

iTrader: (20)

it should be clear on your wage slip what has been taken in pension contribution and what has been taken from your wages is your contribution.

the companys contribution which they have to make by law shouldnt be seen on the wage slip.

if you opt out you wont see the companys contribution anyway , they just wont pay it, the contribution from the company has no effect on your wages and is not taken from you at all.

paulr

Your contribution should be listed on your pay slip as a deduction.
A company pension is often better than a personal one because they make a contribution.

stiscooby

Hhmmm, well there is nothing on my wage slip at all regarding pension so I'm not making a personal contribution.

However, what I'm being paid (before tax etc) works out to be £500 a year less than what my wages have been increased to, which is what they said they would use to pay into a pension.

So it seems as if they are using part of my wage increase as the company's contribution? E.g. "Mr smith, your wages are being increased to x but we're taking £500 from that for pension"?

Don't seem right to me?

jonc

I can't comment on how your company pension operates, but I can tell you how it operated for me.

My company would pay a certain percentage into a scheme, eg. 5%. If I made additional contributions, eg 5% too, the company would also match this. So a total of 15% would be going into the scheme. The added advantage was that the contributions were deducted off the gross salary before tax and NI. Non company personal pensions are usually paid into from your net salary after tax and NI. If your company's pension matches your contribution, I would consider paying the extra into the company scheme rather than your personal scheme.

Also my scheme was also a 'salary sacrifice' scheme, ie, they reduced my salary by the cost of the benefit so I paid less tax and NI.

urban

iTrader: (1)

That's very generous of that company - are you sure that's how it operates.

jonc

Yep, that's how it operated.