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I do not meet the criteria and Maximum amounts?
evosy1978
Posts: 636 Forumite
Hy folks
Firstly, my partner earns less than the criteria for AE, She earns around £6000 a year. She want to opt in. They have emailed her and asked her what she wants to pay in, e.g 1% 2% 3% etc...
Will all of the same conditions apply to her if she opts in as with the people who are Automatically Enrolled ... ?
What is the maximum someone can put in, and would the employer have to match this?
Is it worth someone self employed joining this scheme, just to gain the governments tax relief? (obviously they have no employer to match their contributions)
Thanks
Firstly, my partner earns less than the criteria for AE, She earns around £6000 a year. She want to opt in. They have emailed her and asked her what she wants to pay in, e.g 1% 2% 3% etc...
Will all of the same conditions apply to her if she opts in as with the people who are Automatically Enrolled ... ?
What is the maximum someone can put in, and would the employer have to match this?
Is it worth someone self employed joining this scheme, just to gain the governments tax relief? (obviously they have no employer to match their contributions)
Thanks
0
Comments
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A self employed person would not be a jobholder under AE unless they have a contract of(for?) employment.
If your partner earns over the NI threshold then she would be a non-eligible jobholder with a right to opt in whereupon she will have the same rights as an AE'd eligible jobholder. She has the right to adjust her contributions downwards if she wants.
It gets a bit complicated but AFAIK, maximum is an 8% total* of which 3% comes from the employer. This is being phased in though the current minimum contribution levels are lower.
A self employed person is of course free to join a pension if they so chose. Nothing stopping them.
*Total of qualifying earnings which is roughly between the NI threshold and about £45kMortgage debt - [STRIKE]£8,811.47 [/STRIKE] Paid off!0 -
A self employed person currently qualifies for a lower state pension than an employed person. This is being addressed in the changes coming but depending on your age, you may not catch up the lost years. So, having a personal pension when you are self employed is common sense.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0
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Thanks.
I just want to clarify as the company are asking what % I want to put in.
The most I can put in today that gets matched by the company is 3%. OR are you saying this gets phased in in a few years time, and therefore the most I can put in today that gets matched by the employer is 1%?0 -
I just want to clarify as the company are asking what % I want to put in.
The most I can put in today that gets matched by the company is 3%. OR are you saying this gets phased in in a few years time, and therefore the most I can put in today that gets matched by the employer is 1%?
That is all determined by the pension scheme rules.
The govenment set out the statutory minimum, ie, the minimum an employer who is covered by the automatic enrolment must put into eligible employees' pensions. But employers can be more generous than this if they wish.
The statutory minimum for 2013/14 is a contribution of 2% of earnings between £5,668 and £41,450. At least half of that contribution must come from the employer. So if an eligible employee was earning £10,000 the minimum employer contribution would be (£10,000 less £5,668)*0.01=£43.32 per year, with a total minimum contribution from employer and employee combined of £86.64 per year.
Whether or not the employer offers any matching is up to them - as long as they put at least the minimum amount required into a pension for the employee that is the extent of what they have to contribute.0
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