Topping up workplace pension

Linton

GlasgowExpat2 said:

Linton said:

GlasgowExpat2 said:

Monthly gross pay is £2685.17, pension contribution £349.07 (EE £268.52, ER £80.57). I calculate I can pay an additional £1869 into my pension pot (£2685.17 - £349.07) x 80%. Is that correct?

1) There may be some confusion. "You" do not pay salary sacrificed money into a pension.  You agree to reduce your gross income and the employer agrees that they will put more money into your pension.  If you are currently making no actual pension contributions you can pay your full gross income into a pension.  But if your pension is being paid by SS you cannot take your then gross income to below NMW.

So is your gross pay actually £2685.17/month=£32K. and the SS extra or is the SS included? Is the extra pension being paid through SS?

@El_Torro made much the same point but I dont see a clear answer.

2) The NMW check is made on each pay period, eg if you are paid monthly then it is the monthly NMW that counts  So you cant make a large one-off lump sum payment through SS.

What is EE/ER?

I understand the rules regarding salary sacrifice and that I can’t go below the minimum wage. However I want to make a lump sum payment to my pension pot each month for the maximum amount possible

£2685.17 is before the SS. EE/ER is employee/employer though I know it’s an employer pension contribution. 

Assuming your pension is from salary sacrifice...

If £2685.17/month is before the deduction of the salary sacrifice then your Gross Annual Income is £2685.17/month-£268.52/month = £2416.65/month, your employer contribution is £268.52+£80.57=£349.09/month.. You personally are not contributing anything to the pension.

So in total you could put £2416.65/month into a pension.

However if you want to do this by Salary Sacrifice since NMW is approx (it may vary from month to month, but gov documentation suggests it doesnt) £1462/month.  So the maximum you could SS is £2416.65-£1462= approx £955/month.

Arithmetic errors excepted.