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Your Minimum Pension Savings

For those who have opted into their employer’s auto-enrolment scheme, the new minimum contribution rates for the 19/20 tax year are as follows:

  • Your employer will contribute 3% pa of your qualifying earnings.
  • You will contribute 4% pa.
  • The government then provides 1% tax relief.

With a total 8% of annual savings, it is important to recognise that:

  • Qualifying earnings consist of salary between £6,136 and £50,000.
  • If you do not save beyond the auto-enrolment rates and are earning £50,000, your annual pension savings will be capped at £3,509 pa.
  • This assumes you are making pension savings out of ‘after tax’ income.

Every year, you can make pension savings up to the lower of £40,000 gross or your relevant earnings.  Subject to advice, you can save even more if you did not use your full pension allowance in any of the 3 previous tax years. Understandably, auto-enrolment leaves a lot to be desired for higher earners.

For our Wealth Management clients, annual pension advice beyond auto-enrolment is part of their core service. Through informed planning and expert investment management, pension savings can help to deliver ideal retirements whilst capturing significant tax benefits throughout one’s career. For further information on auto-enrolment or our Wealth Management package, please feel free to get in touch or indeed pass on our details. We will be more than happy to help.


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