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A workplace pension is a way of saving for your retirement that鈥檚 arranged by your employer.

Some workplace pensions are called 鈥榦ccupational鈥�, 鈥榳orks鈥�, 鈥榗ompany鈥� or 鈥榳ork-based鈥� pensions.

How they work

A percentage of your pay is put into the pension scheme automatically every payday.

In most cases, your employer also adds money into the pension scheme for you. You may also get tax relief from the government.

All employers must provide a workplace pension scheme. This is called 鈥榓utomatic enrolment鈥�.

Your employer must automatically enrol you into a pension scheme and make contributions to your pension if all of the following apply:

• 测辞耻鈥檙别 classed as a 鈥榳orker鈥�
• 测辞耻鈥檙别 aged between 22 and State Pension age
• you earn at least 拢10,000 per year
• you usually (鈥榦rdinarily鈥�) work in the UK (read the if 测辞耻鈥檙别 not sure)

When your employer does not have to automatically enrol you

Your employer usually does not have to automatically enrol you if you do not meet the previous criteria or if any of the following apply:

• you鈥檝e already given notice to your employer that 测辞耻鈥檙别 leaving your job, or they鈥檝e given you notice
• you have evidence of your lifetime allowance protection (for example, a certificate from HMRC)
• you鈥檝e already taken a pension that meets the automatic enrolment rules and your employer arranged it
• you get a one-off payment from a workplace pension scheme that鈥檚 closed (a 鈥榳inding up lump sum鈥�), and then leave and rejoin the same job within 12 months of getting the payment
• more than 12 months before your staging date, you left (鈥榦pted out鈥�) of a pension arranged through your employer
• 测辞耻鈥檙别 from an EU member state and in an
• 测辞耻鈥檙别 in a limited liability partnership
• 测辞耻鈥檙别 classed as a 鈥榙irector鈥� without an employment contract and employ at least one other person in your company

You can usually still join their pension if you want to. Your employer cannot refuse.

If your income is low

Your employer does not have to contribute to your pension if you earn these amounts or less:

• 拢520 a month
• 拢120 a week
• 拢480 over 4 weeks

What happens when 测辞耻鈥檙别 automatically enrolled

Your employer must write to you when you鈥檝e been automatically enrolled into their workplace pension scheme. They must tell you:

• the date they added you to the pension scheme
• the type of pension scheme and who runs it
• how much they鈥檒l contribute and how much you鈥檒l have to pay in
• how to leave the scheme, if you want to
• how tax relief applies to you

Delaying your enrolment date

Your employer can delay into a pension scheme by up to 3 months.

In some cases they may be able to delay longer if they鈥檝e chosen either:

• a 鈥榙efined benefit鈥� pension
• a 鈥榟ybrid鈥� pension (a mixture of defined benefit and defined contribution pensions) that allows you to take a defined benefit pension

Your employer must:

• tell you about the delay in writing
• let you join in the meantime if you ask to

What your employer cannot do

Your employer cannot:

• unfairly dismiss or discriminate against you for being in a workplace pension scheme
• encourage or force you to opt out

The amount you and your employer pay towards the pension depends on:

• what type of workplace pension scheme 测辞耻鈥檙别 in
• whether you鈥檝e been automatically enrolled in a workplace pension or you鈥檝e joined one voluntarily (鈥榦pted in鈥�)

Use to work out how much you and your employer will put in.

Tax relief

The government will usually add money to your workplace pension in the form of tax relief if both of the following apply:

• you pay Income Tax
• you pay into a personal pension or workplace pension

Even if you do not pay Income Tax, you鈥檒l still get an additional payment if your pension scheme uses 鈥榬elief at source鈥� to add money to your pension pot.

If you鈥檝e been automatically enrolled

You and your employer must pay a percentage of your earnings into your workplace pension scheme.

How much you pay and what counts as earnings depend on the pension scheme your employer has chosen. Ask your employer about your pension scheme rules.

In most automatic enrolment schemes, you鈥檒l make contributions based on your total earnings between 拢6,240 and 拢50,270 a year before tax.聽Your total earnings include:

• salary or wages
• bonuses and commission
• overtime
• statutory sick pay
• statutory maternity, paternity or adoption pay

Workplace pension contributions

These amounts could be higher for you or your employer because of your pension scheme rules. They鈥檙e higher for most defined benefit pension schemes.

In some schemes, your employer has the option to pay in more than the legal minimum. In these schemes, you can pay in less as long as your employer puts in enough to meet the total minimum contribution.

If you鈥檝e voluntarily enrolled in a workplace pension

Your employer must contribute the minimum amount if you earn more than:

• 拢520 a month
• 拢120 a week
• 拢480 over 4 weeks

They do not have to contribute anything if you earn these amounts or less.

How your take-home pay changes

Joining a workplace pension scheme means that your take-home income will be reduced. But this may:

• mean 测辞耻鈥檙别 entitled to tax credits or an increase in the amount of tax credits you get (although you may not get this until the next tax year)
• mean 测辞耻鈥檙别 entitled to an income-related benefit or an increase in the amount of benefit you get
• reduce the amount of student loan repayments you need to make

Payments using salary sacrifice

You and your employer may agree to use 鈥榮alary sacrifice鈥� (sometimes known as a 鈥楽MART鈥� scheme).

If you do this, you give up part of your salary and your employer pays this straight into your pension. In some cases, this will mean you and your employer pay less tax and National Insurance.

Ask your employer if they use salary sacrifice.

How your pension is protected depends on the type of scheme.

Defined contribution pension schemes

If your employer goes bust

Defined contribution pensions are usually run by pension providers, not employers. You will not lose your pension pot if your employer goes bust.

If your pension provider goes bust

If the pension provider was authorised by the Financial Conduct Authority and cannot pay you, you can get compensation from the .

Trust-based schemes

Some defined contribution schemes are run by a trust appointed by the employer. These are called 鈥榯rust-based schemes鈥�.

You鈥檒l still get your pension if your employer goes out of business. But you might not get as much because the scheme鈥檚 running costs will be paid by members鈥� pension pots instead of the employer.

Defined benefit pension schemes

Your employer is responsible for making sure there鈥檚 enough money in a defined benefit pension to pay each member the promised amount.

You鈥檙e usually protected by the if your employer goes bust and cannot pay your pension.

The Pension Protection Fund usually pays:

• 100% compensation if you鈥檝e reached the scheme鈥檚 pension age
• 90% compensation if 测辞耻鈥檙别 below the scheme鈥檚 pension age

Fraud, theft or bad management

If there鈥檚 a shortfall in your company鈥檚 pension fund because of fraud or theft, you may be eligible for compensation from the .

If you want to make a complaint about the way your workplace pension scheme is run, read .

Your pension provider will send you a statement each year to tell you how much is in your pension pot. You can also ask them for an estimate of how much you鈥檒l get when you start taking your pension pot.

What you see on your payslip

You do not need to do anything to get tax relief at the basic tax rate on your pension contributions. There are 2 types of arrangements:

• net pay
• relief at source

Check with your employer or pension provider which arrangement your workplace pension uses. This determines what you鈥檒l see on your payslip.

鈥楴et pay鈥�

Your employer takes your contribution from your pay before it鈥檚 taxed. You only pay tax on what鈥檚 left. This means you get full tax relief, no matter if you pay tax at the basic, higher or additional tax rate.

You will not get tax relief if you do not pay tax, for example because you earn less than the tax threshold.

鈥楻elief at source鈥�

Your employer takes your pension contribution after taking tax and National Insurance from your pay. However much you earn, your pension provider then adds tax relief to your pension pot at the basic tax rate.

You may be able to claim money back if:

• you pay higher or additional rate Income Tax
• you pay higher or top rate Income Tax in Scotland

Tracing lost pensions

The Pension Tracing Service could help you find pensions you鈥檝e paid into but lost track of.

Nominate someone to get your pension if you die

You may be able to nominate (choose) someone to get your pension if you die before reaching the scheme鈥檚 pension age. You can do this when you first join the pension or by writing to your provider.

Ask your pension provider if you can nominate someone and what they鈥檇 get if you die, for example regular payments or lump sums. Check your scheme鈥檚 rules about:

• who you can nominate - some payments can only go to a dependant, for example your husband, wife, civil partner or child under 23
• whether anything can change what the person gets, for example when and how you start taking your pension pot, or the age you die

You can change your nomination at any time. It鈥檚 important to keep your nominee鈥檚 details up to date.

Sometimes the pension provider can pay the money to someone else, for example if the person you nominated cannot be found or has died.

Taking your pension

Most pension schemes set an age when you can take your pension, usually between 60 and 65. In some circumstances you can take your pension early. The earliest is usually 55.

If the amount of money in your pension pot is quite small, you may be able to take it all as a lump sum. You can take 25% of it tax free, but you鈥檒l pay Income Tax on the rest.

How you get money from your pension depends on the type of scheme 测辞耻鈥檙别 in.

Defined contribution pension schemes

You鈥檒l need to decide how to take your money if 测辞耻鈥檙别 in a defined contribution pension scheme.

Defined benefit pension schemes

You may be able to take some money as a tax free lump sum if 测辞耻鈥檙别 in a defined benefit pension scheme - check with your pension provider. You鈥檒l get the rest as a guaranteed amount each year.

If you change jobs

Your workplace pension still belongs to you. If you do not carry on paying into the scheme, the money will remain invested and you鈥檒l get a pension when you reach the scheme鈥檚 pension age.

You can join another workplace pension scheme if you get a new job.

If you do, you might be able to:

• carry on making contributions to your old pension
• combine the old and new pension schemes

Ask your pension providers about your options.

If you worked at your job for less than 2 years before you left

If you were in a defined benefit pension scheme for less than 2 years, you might be able to either:

• get a refund on what you contributed
• transfer the value of its benefits to another scheme (a 鈥榗ash sum transfer鈥�)

This depends on the type of defined benefit scheme and its rules. Check with your employer or the pension scheme provider.

Paid leave

During paid leave, you and your employer carry on making pension contributions.

The amount you contribute is based on your actual pay during this time, but your employer pays contributions based on the salary you would have received if you were not on leave.

Maternity and other parental leave

You and your employer will continue to make pension contributions if 测辞耻鈥檙别 getting paid during maternity leave.

If 测辞耻鈥檙别 not getting paid, your employer still has to make pension contributions in the first 26 weeks of your leave (鈥極rdinary Maternity Leave鈥�). They have to carry on making contributions afterwards if it鈥檚 in your contract. Check your employer鈥檚 maternity policy.

Unpaid leave

You may be able to make contributions if you want to - check with your employer or the pension scheme provider.

If you become self-employed or stop working

You may be able to carry on contributing to your workplace pension - ask the scheme provider.

You could use the - a workplace pension scheme that working self-employed people or sole directors of limited companies can use.

You could set up a personal or stakeholder pension.

You can get help with your workplace pension options.

What you do if you want to leave a workplace pension depends on whether you鈥檝e been 鈥榓utomatically enrolled鈥� in it or not.

If you have not been automatically enrolled

Check with your employer - they鈥檒l tell you what to do.

If you鈥檝e been automatically enrolled

Your employer will have sent you a letter telling you that you鈥檝e been added to the scheme.

You can leave (called 鈥榦pting out鈥�) if you want to.

You may not be able to get your payments refunded if you opt out later - they鈥檒l usually stay in your pension until you retire.

You can opt out by contacting your pension provider. Your employer must tell you how to do this.

Reducing your payments

You may be able to reduce the amount you contribute to your workplace pension for a short time. Check with both your employer and your pension provider to see if you can do this and how long you can do it for.

Opting back in

You can do this at any time by writing to your employer. They do not have to accept you back into their workplace scheme if you鈥檝e opted in and then opted out in the past 12 months.

Rejoining the scheme automatically

Your employer will automatically re-enrol you in the scheme. They must do this either every 3 years (from the date you first enrolled), or they can choose to do it sooner. They鈥檒l write to you when they do this.

When you do not rejoin automatically

If you no longer qualify for the scheme, you will not be automatically re-enrolled.

If you chose to leave the scheme in the 12 months before the date you would have been re-enrolled, your employer does not have to automatically re-enrol you. But they can choose to re-enrol you.

For questions about the specific terms of your workplace pension scheme, talk to your pension provider or your employer.

You can get free, impartial information about your workplace pension options from:

• if 测辞耻鈥檙别 in a defined contribution pension scheme

You can get advice about workplace pensions from a . You鈥檒l usually have to pay for the advice.

Problems with being 鈥榓utomatically enrolled鈥�

Contact if you have concerns about the way your employer is dealing with automatic enrolment.

You can also , who may be able to help you.

If 测辞耻鈥檙别 already paying into a personal pension

Check whether it鈥檚 better for you to:

• carry on with just your personal pension
• stop paying into your personal pension and join your workplace pension
• keep paying into both

If 测辞耻鈥檙别 saving large amounts in pensions

You may have to pay a tax charge if your total savings in workplace pensions and any other personal pension scheme go above your annual allowance of 拢60,000.

If your pension scheme is closing

This can happen if your employer decides they do not want to use a scheme anymore or they can no longer pay their contributions. Money Helper has information about .

If 测辞耻鈥檙别 getting a divorce

You and your spouse or partner will have to tell the court the value of each of your pension pots. You then have different options to when you get a divorce.