If you’re employed, your employer should have automatically enrolled you into a company pension scheme, into which both they and you must contribute. Under current rules, anyone aged 22 or over earning a minimum of £10,000 from a single job is eligible for auto-enrolment. You can choose to opt out if you want to, but it’s not usually recommended unless there are exceptional circumstances, for example, you need to pay back expensive debts first.
If you’ve been auto-enrolled into your employer’s workplace pension scheme, under current minimum contribution limits, you’ll be paying in 5% of your salary before tax (of which 1% is tax relief), whilst your employer will pay in 3%, bringing the total contribution to 8%. Your payslip should show any pension contributions that are deducted each month and if you’re not sure whether you’ve been auto-enrolled, check with your employer.
Some employers will pay in more than the minimum contribution, and you can pay in extra if you want to. You are also able to make additional one off voluntary contributions into a workplace pension at any time and still receive any tax relief eligible to you – simply call your pension provider and speak to them about the options available to you. Find out more about auto-enrolment in our guide How does pension auto-enrolment work?
If you earn less than £10,000 a year, perhaps because you work part-time, you can still ask your employer if you can join the company scheme and they can’t refuse. However, bear in mind that if you earn less than £520 a month, or £120 a week, your employer doesn’t have to contribute to your pension. Find out more in our article Can I join my workplace pension scheme if I’m on a low salary?
Even if your employer contributes into a workplace pension on your behalf, you are still able to take out a private pension on your own to supplement your pension – providing you stay within your annual contribution allowances.