Changes to Pension Contributions
News posted by Hemi Trenholm 4 years ago
Update to Pensions in Payroll
The team at Clear Books care about making things simple for our customers and in light of feedback received from you we have made some tweaks to the calculation of pension contributions in our Payroll system.
From tomorrow (Thursday 12th May) the following changes will come into effect:
- Additional pre-tax payments are now included as pensionable earnings
- Hourly pay is now included as pensionable earnings
The screenshot below shows an example for an hourly paid worker whose pension scheme is based on applying contributions to all pensionable pay with basic rate tax relief at source.
How does this affect me?
With the arrival of these changes, our customers will no longer have to manually calculate the correct contributions. When using hourly pay and/or adding additional pre-tax payments on employee payslips, those amounts will now be counted as pensionable pay and be used to calculate the employee’s and employer’s pension contribution amounts. This means that that the contributions may now be higher than they were in previous months.
Who will use it?
Our customers who have employees enrolled in qualified pension schemes as part of the automatic enrolment program.
How do I start using it?
If you’re already using our Payroll application, you don’t need to do anything – you’ll simply see these changes next time you go to process your employees’ payroll (from 9am on Thursday 12th May).