Any payroll or pension experts about? Can I backdate employee pension contributions?

[AnotherEmma]

I haven't been making employee pension contributions (for various reasons, but yes I know I'm an idiot, and I'm kicking myself!)
I am going to email our payroll person tomorrow and ask to start making contributions from now onwards.
But does anyone know if it might be possible to backdate contributions or making a large one-off contribution to "top up" as it were?
I realise it must be too late for previous tax years but I'm hoping to contribute a decent amount before the end of this tax year, if I can.
Also I'm assuming I have to do it via the payroll?

I don't think you can backdate them, but I don't see why you can't up your contributions.

My pension plan does allow me to do additional contributions personally, and via my employer as well.

Depends on your particular scheme, but I wouldn't see why they wouldn't let you if available.

You can't backdate but you can just add a certain amount yourself but won't get the employers contributions

No reason why you shouldn't make additional voluntary contributions. You can usually make contributions of up to £40k per year or 100% of your salary, whichever is lower. In addition you can carry forward your allowance for the previous 3 years.

If your scheme is run on a salary sacrifice basis it may be more complicated because there may be a limit to how often you can make changes, but HR should advise you of this. If necessary then it's fairly straightforward to open up a personal pension and make contributions directly into this.

Thank you very much for your replies.
Sadly 100% of my salary is definitely lower than £40k (part-time charity job!)
On the up side I've still been getting employer contributions so all is not lost, it's just a pitifully low amount so I do need to top up.
Will ask payroll lady tomorrow, I doubt she'll know off the top of her head but I hope she can find out for me.
They kindly joined the childcare voucher scheme at my request and I had to send instructions

With many defined contribution schemes you can simply login to the employee portal (such as on NEST Pensions) and male a voluntary contribution via debit card. Tax relief will then be added by the pension provider at 20%.

If it is a salary sacrifice scheme then it is more complicated. Talk to payroll.

No reason why you shouldn't make additional voluntary contributions. You can usually make contributions of up to £40k per year or 100% of your salary, whichever is lower. In addition you can carry forward your allowance for the previous 3 years.

You can only carry forward if you have maxed out the annual allowance (£40,000). You can only get tax relief on 100% of your earnings. Therefore you can only max out the annual allowance if your earnings exceed £40,000.

You can pay more than 100% of your earnings but you don't get tax relief on anything over your earnings. Since you will have to pay tax when you take the money it is rarely a tax advantage way of saving.

Speak to your employer about how they pay additional contributions.

Evening all. Fun pension/tax question for a Friday night!

After starting this thread a month ago, I asked my colleague who looks after our accounts and payroll whether I could make a one-off pension contribution as a salary sacrifice, and she said yes, she would just tell our payroll provider. So I emailed her to confirm the amount I wanted to pay. But we got our March payslips this week and the deduction hasn't been made 🙄 She said she did ask the payroll provider but they messed up. This isn't the end of the world, as I can still pay in directly. But I do have a question... according to my calculations, making pension contributions via salary sacrifice means that I pay less tax through PAYE. Whereas if I pay directly, I've already been taxed, so is there any way I can recoup that tax?

I wanted to make my one off lump sum contribution out of my March salary, so it would be in the 2018-19 tax year and the tax would all be worked out through PAYE. Obviously that won't happen now and I'm not sure what I need to do about it (the tax, that is).

Not sure I've explained myself very well, thanks to anyone who read it all!

I’d insist they re run payroll for you for month 12 as this is very unfair to you!

It's not a huge amount of tax I'd be saving, but it is annoying that they didn't action my request, so maybe I should ask them on principle.

It's just extra work/faff for my colleague and we're all overworked and underpaid (did I mention I work for a charity?!)

Not quite getting my head around this one.

You have NOT been making personal pension contributions but your employers HAVE. Are they paying the full 5% of your salary then?

Also, did you realise that salary sacrifice is not something you can just opt in and out of when you please? You have to have your contract of employment changed. I suspect the payroll people know what's what and unfortunately your accounts person does not.

Yes it's weird but my employer makes contributions for everyone even if they're not contributing themselves.

So I've been getting employer contributions, but I want to also make employee contributions.

We are only just being affected by the 8% rule, we have all be asked to opt in or out (basically we have to start making employee contributions or we'll lose the employer ones).

When I considered it, I regretted not contributing earlier and making some tax savings. Hence wanting to make a lump sum contribution before the end of this tax year.

Cross post

"Also, did you realise that salary sacrifice is not something you can just opt in and out of when you please? You have to have your contract of employment changed. I suspect the payroll people know what's what and unfortunately your accounts person does not."

Yes I think you are probably right. My colleague is not hugely experienced in payroll. So I suspect she didn't actually check when she told me that I could just make a one-off contribution.

I do understand that salary sacrifice affects our contract, as I signed up to the childcare voucher scheme and signed an agreement about that.

I don't find this particularly thrilling and also have a terrible memory so I'm afraid I understand enough to make a decision and then promptly forget the finer details!

If you're opting in as an entitled worker or a non-eligible worker then contributions will be taken from your opt in date.

You can ask to make additional contributions above the 5% employee contribution after this date.

Unless you're an eligible worker & your payroll department hasn't deducted your contributions when they should have been they're under no obligation to backdate your contributions before your opt in date and you will have to officially opt in before they can make any deduction for pension contributions.

I did opt in; that is, I emailed our accounts/payroll person to confirm that I wanted to opt in and to confirm the percentage contribution. I suppose by official opt-in do you mean sign an amended contract and/or salary sacrifice agreement? In which case no, they haven't given me one to sign yet.

They are probably just being slow and inefficient which wouldn't surprise me.

Your employer isn’t obliged to facilitate you making additional contributions or one off payments. They must enrol you though if you’ve asked to opt in. Whatever your status. But as long as your earnings are above £5876 per year, your employer must also pay contributions.

If you pay into your pension directly from your bank account, you will get tax relief. If you make additional payments via your employer, it will depend whether your contributions are calculated on a gross or net tax basis

Thank you.

It's fine that they're not obligated to facilitate additional / one-off payments, that's fair enough. But when I asked if it was possible, they said yes, so it is annoying if it turns out they won't let me do it after all.

Either way they certainly should have enrolled me for regular contributions from this month onwards, as I asked them to (in writing) more than a month ago. Obviously my regular contribution isn't huge so starting one month late isn't the end of the world.

Anyway I will make a one-off payment myself via my bank account.

Thanks again for all the info, very helpful.

Ps thank you to everyone, that is.

You'll get the tax back no matter which way you pay, if you pay direct either the pension scheme will add it to your contribution for you (most likely) or you can fill in a tax return at the end of the year to get it back.

What you loose out on by paying direct rather than by salary sacrifice is national insurance - which you don't pay if you pay by salary sacrifice but don't get back if you pay direct. How much that matters depends on what you earn!