Payment of staff deductions to pension scheme

TaylorDI_2

Hi
After noticing in February that my employer had failed to pass on two salary sacrifice deductions (July and August 2015) to my private pension I ambelatedly taking a very keen interest in pension regulations! I notice that my employer has up to the 22nd day of the next month to pay money over electronically. Can anyone explain why this is necessary, especially with automated payroll systems?
Thanks
Dee

mania112

I thought it was the 19th, but i'll take your word.

Payroll don't pay the pension contribution, it's a payment from company accounts to the pension provider.

Payroll is all about separating net from gross so that staff can be paid - that's the priority.

Thereafter tax is paid, and pension contributions if applicable.

There needs to be some allowance for this to be completed, especially for big, complex payrolls.

mgdavid

some companies almost certainly abuse the system and use pension fund contributions as working capital short-term. A previous employer of mine frequently (but randomly) missed a month's payments and then 'caught up' the following month.

pelirocco

The company has to have time to check the figures and get the info uploaded to pension provider.I know ours has been a right pain to set up ancient there's often a technical hitch with the upload.I opted to have them take payments by dd to make life easier.The date ties in with paye payment dates, although with RTI I wish they would take payment automatically by DD, VAT has been doing that for some while, I am sure they wouldn't have such a big problem with non payers if they did.And just maybe they wouldn't 'lose' so many payments (or is that just me lol )

JoeCrystal

That was my impression as well and when I checked with my employer and pension provider on this, they both confirmed that my employer produce payments of all contributions over to the pension provider in 2 months arrears. So clearly, there are much more leeways in the length of time.

vacheron

Your provider isn't Scottish Widows by any chance is it?

They failed to take three salary sacrifice payments from our whole company around the same time as you, they eventually reinstated them in around October with an apology.

We used to have similar delays whereby each month they showed a "payment date" which was a couple of days after months payday, but their website also had a "payment received date" which was always about 3 - 3 1/2 weeks later. Funds were then purchased a couple of weeks after that making a 5 week delay of 'someone' holding our payments as cash. Very frustrating in a rising market!

SteveG787

Does anybody know what the tax relief situation is in this case. My pension contributions are usually paid a couple of days after wages but sometimes up to a couple of weeks later. If this happens this month then I will only have had 11 pension contributions this tax year and next tax year I am retiring so am restricted by that. I guess what I'm asking is which date is important for the tax relief to count in a particular tax year, pay date, pension contribution date, tax relief application date or tax relief received date ?

pjread

I'm pretty sure it's the pension contribution date

mark5

My employer constantly does it.