Company charging me for opting out of auto enrolement pension

sickofants

My wage is structured similarly.

I have a basic salary and then a benefit on top of this which is 25% of basic salary. Like you, I am able to take it on my wage. Like you, I also have deductions from this benefit that I didn't submit to and which are mandatory. In my case, I have to take Life Assurance and Disability Cover.

I have to agree with everybody that opting out can't be in your best interest. On your salary you could surely get credit for cheap enough that you would do better in the end by foregoing the extra £20 on your wage. That's even if it's accepted that £20pcm is going to make a material difference to your situation (I can't see how it would). If they're going to penalise you for opting out that only makes things clearer.

dunstonh

My salary is £35000 basic and then I have a benefits fund of £6272 which we can use for more holidays, health cover etc or we can take as salary which is what I have done

followed by....

The minimum Contribution I can do is 2% and currently I need this money

Clearly you dont need the money. You just dont have the right priorities and are willing to through away hundreds of pounds a year of free money to save £20pm so you can spend more on your holiday. Pension is more of a priority than healthcare as statistically you are far more likely to draw on the pension than use healthcare.

sickofants

I think you have misunderstood dustonh.

The £6272 can be used to buy benefits like additional holidays or health care without incurring income tax and NI. Nicola chooses to take it as taxable income.

At least I assume that is what is going on, just because that's how it works for my company who offer a similar package.

nicola261180

I love the fact that I have come on here for advice to see if what my company is doing is legal or not, to be then basically made to feel a bit of idiot in what I am doing, I have my own pension ideas that have not been brought to light on here so what I do with my money should be my business. I am not spending it on holidays and such I have just moved house so at the moment I am using it for that, I save money where I can shopping, gas elec, water insurance and the like. So if someone can answer the question rather than dictate whow best to use my money then please do so.

nicola261180

Just to confirm I am being charged £30 to opt out or £83 a month minimum to be in.

Southend1

nicola261180 wrote: »

I love the fact that I have come on here for advice to see if what my company is doing is legal or not, to be then basically made to feel a bit of idiot in what I am doing, I have my own pension ideas that have not been brought to light on here so what I do with my money should be my business. I am not spending it on holidays and such I have just moved house so at the moment I am using it for that, I save money where I can shopping, gas elec, water insurance and the like. So if someone can answer the question rather than dictate whow best to use my money then please do so.

To be fair the fact that you are feeling "a bit of an idiot" is probably more because opting out is very silly than because a bunch of people have pointed that out!

nicola261180

Yes but why can no one answer the question £80 is alot to me at the moment which I keep reiterating

Southend1

nicola261180 wrote: »

Yes but why can no one answer the question £80 is alot to me at the moment which I keep reiterating

Probably because you need to check with your payroll office and pension provider to find out exactly what they have done. BUT..... If £80 is a lot of money to you, why are you throwing away more than this by opting out?! Unless you can't meet your immediate basic needs for food, shelter and warmth then it is a bad decision to give up FREE MONEY to have a few extra pounds in your pocket right now.

flea72

The most obvious answers have already been given. I agree it looks like your pay included the pension contribution and they are therefore taking this back.

You are entitled to opt out, yes we get that. But it doesnt make sense to do it. When an employer offers you free money, its wise to take it. You intimate that you have other pension provisions, can these not be redistributed to the inhouse pension scheme?

SomeUser

This is either an administrative error or a misunderstanding through poor payslips. You cannot be charged to opt-out.