| Add The People's Pension scheme |
Description | If you want to use The People's Pension, you can set this up in Sage Payroll. NOTE: Once you create your scheme, you can edit but not delete it. |
Resolution | If you’re new to Payroll, or you haven’t set up your People's Pension scheme yet, you must complete the following tasks: To set up your pension, you need certain information from The People's Pension. Correct information is crucial, to ensure accurate pension calculations for your employees. To find this information, you should log in to your online account (opens in a new tab). You'll need the following details: - Your unique ID. This is the unique ID given to you when you joined Peoples Pension
NOTE: A different unique ID is used for each pay frequency you want to process. For example, if you have weekly and monthly payroll, you need two unique ID's. - The Group Identifier for this pension plan
- The type of contribution. Whether it's salary sacrifice, deducted before or after tax.
- The type of deduction. This is a percentage or fixed amount
- The employee and employer contribution percentages or amounts
- Your earnings basis. Whether it's based on unbanded earnings, banded earnings or custom earnings
NOTE: Earnings basis does not apply for salary sacrifice pensions. - Your contributions payment date. When you pay your pension contributions to The People's Pension
Once you've gathered all the information you can add your pension scheme to payroll. - Select Pensions, then Add a new pension.
- Select The People’s Pension.
- In the Unique ID box, enter your unique ID provided by The People's Pension.
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Select Add Group and complete the relevant fields from the table. Group Description | The People's Pension group description | Group Identifier | The Worker group you've set up for this plan. The People's Pension uses Worker groups. You have different contribution rates for your employees. Set up a plan for each worker group. | Type of contribution | Choose the type of contribution you have with The Peoples Pension. -
Salary sacrifice. Money paid into the pension deducts from your employee's gross pay. This deducts before calculating tax and National Insurance NOTE: With Salary sacrifice, enter the percentage contribution for the employer and employee. The employee contribution shows as a negative payment on the payslip. -
Contribution deducted before tax. Money paid into the pension deducts from your employee's gross pay. This deducts before calculating tax. Taxable gross pay reduces the amount of the pension contribution. This means the employee does not pay tax on this contribution -
Contribution deducted after tax. The money paid into the pension deducts after tax calculates. The pension provider claims back the tax paid on this contribution, direct from HMRC | Type of deduction | Choose whether the rates are a percentage of the employees’ pay or a fixed amount. NOTE: This option is not available for Salary sacrifice contributions. | Employer Contribution | Enter the percent or fixed amount you pay into the pension scheme. | Employee Contribution | Enter the percent or fixed amount your employee pays into the pension scheme. | - Select Next and complete the relevant fields from the table.
Earnings Basis | Only if you chose a percentage deduction, choose one of the following options: - Pensionable Pay. The calculation uses only payments that have the Pension Earnings check box selected
- Qualifying Earnings. The calculation uses only payments that have the Qualifying Earnings check box selected
- You can enter your own thresholds for pension contributions. You can then enter an annual lower and upper earnings limit. When you process your pay run, Payroll adjusts the thresholds based on the pay frequency. It only deducts pension on earnings between the two bands
These options are not available for Salary sacrifice contributions. | Annual lower earnings limit (£) | This option only appears if you chose Custom Earnings Basis. Enter the annual lower earnings limit for your pension. | Annual upper earnings limit (£) | This option only appears if you chose Custom Earnings Basis. Enter the annual upper earnings limit for your pension. | Contributions payment date | Select the date you pay the pension contributions to your pension provider. | Default plan (optional) | Enroling employees into this pension scheme is automatic if you select this box. You can change this for individual employees when you process their pay run. | - Select Save. You can repeat the process to add more groups. For example, have a different group for Staff and Directors.
- Select Scheme Frequency.
NOTE: You are only allowed one scheme per pay frequency. For example, if you have weekly and monthly paid employees, set up separate weekly and monthly schemes. - Select the Qualifying Scheme check box.
- To read the terms, select the our terms link. To accept them, select the Terms check box.
- Select Save.
- To set up a scheme for a different pay frequency, begin again at step 1.
NOTE: Payroll will correctly calculate pre-tax and post-tax deductions. You do not need to adjust the percentage amounts to allow for a pre or post tax calculation. Your employees can pay more into their pension scheme if they wish. This is called an Additional Voluntary Contribution (AVC). This can be on done on an Ad-Hoc or regular basis. They can contribute a percentage or a fixed amount. You don't have to create a new scheme for these employees. You add the AVC into the employees record at the Edit pay screen of the payment run. From the payment run Edit pay screen: - Select the employee.
- Select Manage enrolment.
- Select Manage contributions.
- Change Deduct Additional Voluntary Contributions from Off to On.
- Select the frequency of the Voluntary Contribution.
- From Additional Voluntary Contribution type, select either:
- % of pensionable earnings
- % of qualifying earnings
- Fixed amount
- Enter a value for the deduction.
- Select Save.
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