Work pension question

[KangarooKenny]

A pension I’ve been offered is employee paying 5% of NET and employer 5% of gross. The scheme is based on total earnings anything from £1 up to whole time.
Can anyone tell me the difference between NET and gross, and if this is good ?

Net is your wages after tax and ni. Gross is before, it’s better your employer pays gross as it’s a higher contribution.

You probably pay net because the scheme then reclaim the tax (20% of the 5% - so the extra 1%).
So effectively you get 10% of gross into the pension.
I'd be surprised if it is 5% of your actual net, after other deductions - NI, student loan, subs - but rather 5% on a net basis (ie 5% - 20% tax = 4%).
You do lose out on NI in this sort of arrangement, as your NI is calculated on your gross.

Oh, and if you are a higher rate tax payers, you also need to claim the tax relief on the higher rate element.

So it’s not good ?
The other pension scheme offered is based on ‘qualifying earnings, employees pay 5% and employer pays 3%, qualifying earnings are anything over £520 so members only pay pension on what they earn over that’.

Your pension contribution isn’t taxable or doesn’t have to be therefore if you are taxed first and then your pension is taken out, surely you’ll be missing out on not having that money taxed

Why would it not be good?

Im asking because I don’t understand pensions, don’t know what’s good or bad.

If it's a defined contribution scheme go by what the employer pays into it as to which is the better option. So in this scenario the 5% option is more generous.

Pensions are so confusing. Ive got a smart pension at work and its smarter than me cos i cant figure it out either.

Option 1: employer 5%
Option 2: employer 3% over £520

So Option 1 is the higher employer contribution.

Ignore the employee contribution as that's what you are paying - and if you want to pay more into a pension you can.

Presumably these are different jobs, rather than different pension choices from the same job?
There are probably other differences between the jobs which might be better drivers as to which to take.

No, it’s the same job.