Reminder of increased minimum contribution rates from April 2018 for Auto enrolment

Currently with auto enrolment, there is a minimum total amount that has to be contributed to a pension scheme by both the employee and the employer. The total minimum contribution is currently set at 2% of the employee’s earnings, with the employer paying a minimum of 1%.

Contributions are being increased gradually over time. From 6th April 2018, the total minimum contribution will rise to 5% with a 2% minimum employer contribution and the employee contributing the remaining 3%.  Minimum contributions will undergo further increases on 6th April 2019, with the total minimum contribution rate increasing to 8% (3% employer, 5% employee). If as an employer you choose to pay more than the employer minimum but less than the total minimum amount, then the employee must make up the difference.