Auto-Enrolment
The legal requirement for employers to automatically enrol eligible workers into a workplace pension scheme and make contributions on their behalf. Workers aged 22 to State Pension age earning more than £10,000 per year must be enrolled, though they can opt out. Minimum total contributions are 8% of qualifying earnings, with at least 3% coming from the employer.
Related Terms
Salary Sacrifice
An arrangement where you give up part of your salary in exchange for a non-cash benefit such as employer pension contributions, a cycle-to-work scheme, or an electric car.
Pension Tax Relief
A government top-up on pension contributions that effectively returns income tax paid on the contributed amount, making pensions a highly tax-efficient saving vehicle.
Annual Allowance
The maximum amount you can contribute to registered pension schemes each tax year while still receiving tax relief, currently set at £60,000.
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