Set up and manage a workplace pension scheme

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How to set up a workplace pension scheme

You must set up a workplace pension scheme for eligible staff if you do not already offer one.

Use The Pensions Regulator’s tool for employers to find out what you need to do and when you need to do it.

If you already have a workplace pension scheme that you’d like to use for automatic enrolment, you must ask the provider if it meets the rules.

How much you must pay

You must pay at least 3% of your employee’s ‘qualifying earnings’ into your staff’s pension scheme.

Check the pension scheme you’re using to find out what counts as ‘qualifying earnings’.

Under most schemes, it’s the employee’s total earnings between £6,240 and £50,270 a year before tax. Total earnings include:

  • salary or wages
  • bonuses and commission
  • overtime
  • statutory sick pay
  • statutory maternity, paternity or adoption pay

Paying contributions

You must deduct contributions from your staff’s pay each month. You’ll need to pay these into your staff’s pension scheme by the 22nd day (19th if you pay by cheque) of the next month.

You must pay your contributions for each employee by the date you’ve agreed with your provider every time you run payroll. You must backdate any missed payments.

You may be fined if you pay late or do not pay the minimum contribution for each member of staff.

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  1. Step 1 Decide what type of employee you need

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    2. Check the different types of employment status

  2. and Check you can afford to take on employees

    1. Check how much the National Minimum Wage is
    2. Find out how much National Insurance you need to pay for your employees
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    4. You are currently viewing: Check how much you need to pay towards your employee's pension
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    You also need to make checks when you recruit and employ someone.

    1. Find out what you need to check when you employ someone

  4. Step 3 Register as an employer and set up PAYE

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    1. Understand your pension responsibilities as an employer

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