Company Switching to Money Purchase Scheme

jamesd

0.25% would be a very strange amount to use. Probably a mistake somewhere in getting to that value.

grey_gym_sock

!!!!!!_here wrote: »

So I'm saving my 12%, but am only getting an extra .25% 'share' out of the company saving 13.8%. Is that right ? It doesn't sound generous in those terms !

if you have a salary sacrifice of 4.75%, and the employer adds 0.25% to that ...

then (i think) the employer is saving 13.8% employer NI on the 4.75% - which is 0.6555% ... of which they're giving you 0.25% and therefore keeping 0.4055%.

kidmugsy

grey_gym_sock wrote: »

(i think) the employer is saving 13.8% employer NI on the 4.75% - which is 0.6555% ... of which they're giving you 0.25% and therefore keeping 0.4055%.

Hurray, an explanation that makes sense. So if you assume that 0.1555% is used to defray the employer's costs, then the remaining 0.5% is being split half-and-half.

I have no evidence that his costs would be 0.1555% but they obviously won't be zero.

Dick_here

grey_gym_sock wrote: »

if you have a salary sacrifice of 4.75%, and the employer adds 0.25% to that ...

then (i think) the employer is saving 13.8% employer NI on the 4.75% - which is 0.6555% ... of which they're giving you 0.25% and therefore keeping 0.4055%.

The principle makes sense to me here now, many thanks.

Though up until now I've been paying 7% (actually 6.75% after sacrifice), so 13.8% of that is 0.966%. They've been keeping 0.716% and contributing the other 0.25% to my pension. Is that a bit mean ?