Before you startTo ensure your software calculates pension contributions accurately you must enter the correct scheme settings.If you aren't sure of what you need, use our handy guide to find out about the Information you need to set up a pension scheme. If you aren't sure of these details, check them with your pension provider before you start. It's also important that you set which pay elements are included in the pension calculation. Before you process any pension values, check you've Set up your pay elements for pension contributions.
Enter your scheme details- Click the Company navigation bar then click Pension Schemes.
- In the Enrolment Review Date box, enter the date you next need to review your pension schemes for automatic enrolment.
- Select a pension scheme, then to open the Pension window click Edit.
- Enter your scheme details in the four tabs Details, Employee, Employer and Provider.
For details of the fields in each of the four tabs, click their names below. | Reference | The pension scheme reference number appears here. This is created by your software and is used to identify the scheme. |
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| Description | Enter a name for your pension scheme here, this box takes a maximum of 30 characters. |
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| Type | From the drop-down list, click the type of scheme. |
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| SCON | You don't need to enter anything in here as the scheme contracted out number (SCON) is no longer required. |
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| Qualifying Scheme | If the scheme is a qualifying scheme for automatic enrolment, select this check box. |
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| Use Qualifying Earnings for pensionable pay | To calculate the pension contribution based on qualifying earnings, select this check box. Qualifying Earnings uses a lower and upper threshold onto pay used in the pension calculation. For the 2022/23 tax year, only pay from £6,240 to £50,270 per year is included in the pension calculation with this option enabled. |
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| Scheme minimum contribution (Total of Ee and Er) | This updates automatically if you enter a value in the Minimum Contribution (period) boxes on the Employee and Employer tabs. |
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| Minimum Employment Period (Months) | If the scheme is a qualifying scheme for automatic enrolment, leave this section blank. If you need to apply a minimum employment period before enrolment you should apply a postponement. How do I postpone a pension assessment? > |
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Salary Sacrifice Scheme | If the pension scheme is a salary sacrifice scheme, select this check box. Salary sacrifice pension schemes > |
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| Stakeholder Friendly | This check box is only available if you choose a COMP or COMB type of scheme. If your pension scheme has stakeholder rules applied to it, select this check box. |
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- In the Pension window, click the Employee tab.
- Under the Contribution heading, click the dropdown box.
- Select Fixed Amount or Percentage then enter the required contribution amount.
- If contributions are percentage based, select an option:
- Apply to all Pensionable Earnings: Calculate pension contributions on your employee's total pensionable pay
- Restrict to Statutory N.I Upper/Lower bands: Uses NI thresholds to limit pensionable pay
- Restrict to Specific Upper/Lower Bands: Enter your own bands to limit pensionable pay
- If the scheme has a minimum contribution enter this in the Minimum Contribution (period) box.
- If applicable, enter the maximum annual employee contribution in the Maximum Contribution (annual) box.
- Under the Settings heading, enter the following information:
- Calculate Minimum Rebate: Select this checkbox for payroll to automatically calculate the NI contracted out rebate, also known as the minimum contribution to a contracted out scheme. This option isn't available for all schemes
- Include Rebate and Amount: Select this checkbox to deduct the minimum rebate amount in addition to the main pension contribution. This option isn't available for all schemes
- Include statutory payments: When this checkbox is selected your software includes statutory payments in the pension calculation
- Deduct Before Tax: This setting is locked for all scheme types except Other and Master Trust. Select this checkbox to deduct pension contributions before tax. In Salary sacrifice schemes this box is called Reduce Gross Salary and is selected by default
- Click the Employer tab In the pension scheme window.
- Under the Contribution heading, click the dropdown box.
- Select Fixed Amount or Percentage as required and enter the contribution amount.
- If contributions are percentage based, select an option:
- Apply to all Pensionable Earnings: Calculate pension contributions on your employee's total pensionable pay
- Restrict to Statutory N.I Upper/Lower bands: NI thresholds limit pensionable pay
- Restrict to Specific Upper/Lower Bands: Enter your own bands to limit pensionable pay
- If the scheme has a minimum contribution enter this in the Minimum Contribution (period) box.
- If applicable, enter the maximum annual employee contribution in the Maximum Contribution (annual) box.
- Under the Settings heading, enter the following information:
- Calculate Minimum Rebate: Select this checkbox for payroll to automatically calculate the NI contracted out rebate, also known as the minimum contribution to a contracted out scheme. This option isn't available for all schemes
- Include Rebate and Amount: Select this checkbox to deduct the minimum rebate amount in addition to the main pension contribution. This option isn't available for all schemes
- Include statutory payments: When this checkbox is selected your software includes statutory payments in the pension calculation
- Click the Provider tab in the pension scheme window.
- Select your pension provider in the Provider dropdown menu. If your provider isn't listed, select Other.
 TIP: If you've set up Pensions Data Exchange the Provider dropdown menu isn't available. - Enter your pension provider's details in the Provider Details section.
- In the Provider Payment Details section, enter your pension provider's payment details.
- In the Administrator Details section, enter the details of your point of contact at your business for pensions.
- To save the pension scheme details, click OK then Close.
Your pension scheme is now set up and ready to calculate contributions.
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