Pension salary exchange and minimum wage increase

[Jaggs]

Has anyone figured out what the increase in the minimum wage will do to pension contributions with relation to staying within Pension Salary Exchange limits.

I know it will be different depending what pension scheme you are in but I've done some quick sums that I think are based on my situation. I'm in the rmdcp and according to my payslip my pensionable pay is £455.05 per week.

So 455.05 - 10.32 x37 = 69.51

69.51/455.05=0.1527

So 0.1527-0.06=0.0927

So on top of my basic contribution of 6% I could pay an avc of 9% while still staying within Pension salary exchange rules or have I got something wrong.

[heapsy]

I'm wondering about this too. The new wage will actually be £10.42. I'm close to the limit, currently paying £120.88 in total, 37 hour contract.I think I'm going to have to reduce my payments by about £20 per week. I was hoping the dispute would have been sorted by now with a new, higher wage. Will try ringing today to get some clarity. Will post on here when I know more.

[heapsy]

So, as promised I'm back. I rang the pensions office earlier and have to say they were not helpful one bit. In their eyes, telling me the maximum I can pay in to the AVCs and remain in PSE is financial advice. I even talked with someone in HR. Same answer. So, I know I'm pretty close to the limit right now. Paying £120.88 in total. I'll be chopping my contributions to £87.88 from April. No sign of a new pay deal and the minimum wage increases by nearly £1 per hour. Keep your eyes on your payments eveybody!

[david3595]

So, as promised I'm back. I rang the pensions office earlier and have to say they were not helpful one bit. In their eyes, telling me the maximum I can pay in to the AVCs and remain in PSE is financial advice. I even talked with someone in HR. Same answer. So, I know I'm pretty close to the limit right now. Paying £120.88 in total. I'll be chopping my contributions to £87.88 from April. No sign of a new pay deal and the minimum wage increases by nearly £1 per hour. Keep your eyes on your payments eveybody!

Thanks Heapsy

[heapsy]

Sent my form back today to reduce my AVC payments through Flexi plan. Gone down from £118 per week to £83 per week. Yes I know, hell of a drop, but with Pensions and HR claiming they cannot tell me the figures we are allowed to contribute and still stay in PSE I had no choice. Check your payments everbody! Just hoping there is a delay in the introduction of the new scheme so I get get more in. Maybe a pay rise might help with that.

[freespeech]

So, as promised I'm back. I rang the pensions office earlier and have to say they were not helpful one bit. In their eyes, telling me the maximum I can pay in to the AVCs and remain in PSE is financial advice. I even talked with someone in HR. Same answer. So, I know I'm pretty close to the limit right now. Paying £120.88 in total. I'll be chopping my contributions to £87.88 from April. No sign of a new pay deal and the minimum wage increases by nearly £1 per hour. Keep your eyes on your payments eveybody!

I assume if you are over they stop it? If they do that surely they are making a "financial advice" decision too? Madness.

[RobertT]

If you pay too much and drop out of PSE, you pay more NICs.

A £100 gross payment only costs a net of £68 when within PSE limits. But would cost a net of £80 if you're over those limits.

[NWpostie]

I'm currently paying £110 a week and I'm also thinking about this too.

[Hyrrokkin]

So, as promised I'm back. I rang the pensions office earlier and have to say they were not helpful one bit. In their eyes, telling me the maximum I can pay in to the AVCs and remain in PSE is financial advice. I even talked with someone in HR. Same answer. So, I know I'm pretty close to the limit right now. Paying £120.88 in total. I'll be chopping my contributions to £87.88 from April. No sign of a new pay deal and the minimum wage increases by nearly £1 per hour. Keep your eyes on your payments eveybody!

I assume if you are over they stop it? If they do that surely they are making a "financial advice" decision too? Madness.

Agreed "we cannot help you it is classed as financial advice" is complete nonsence...not their fault they have to follow the rules but still rubbish
Simply asking what is the limit you can make to stay within PSE - to me that is asking for straightforward information,no more no less.
If i asked what funds should i invest in that is advice
Whole system is made up of stupid rules
I am paying £108pw so that will have to go down soon

[heapsy]

So, as promised I'm back. I rang the pensions office earlier and have to say they were not helpful one bit. In their eyes, telling me the maximum I can pay in to the AVCs and remain in PSE is financial advice. I even talked with someone in HR. Same answer. So, I know I'm pretty close to the limit right now. Paying £120.88 in total. I'll be chopping my contributions to £87.88 from April. No sign of a new pay deal and the minimum wage increases by nearly £1 per hour. Keep your eyes on your payments eveybody!

I assume if you are over they stop it? If they do that surely they are making a "financial advice" decision too? Madness.

No, they don't stop it. It's up to you. That's why I posted. In the past I was caught out and it took me two weeks to put it right due to waiting for the form from pensions. My new figure is based on a rough calculation based on the 92p per hour increase in the minimum wage. 92p x 37 hrs is £34.04. So I reduced by £35. I was hoping we might get an increase in pay so I could increase at some point before the scheme closed. But with the current situation it doesn't look likely.

[heapsy]

So, as promised I'm back. I rang the pensions office earlier and have to say they were not helpful one bit. In their eyes, telling me the maximum I can pay in to the AVCs and remain in PSE is financial advice. I even talked with someone in HR. Same answer. So, I know I'm pretty close to the limit right now. Paying £120.88 in total. I'll be chopping my contributions to £87.88 from April. No sign of a new pay deal and the minimum wage increases by nearly £1 per hour. Keep your eyes on your payments eveybody!

I assume if you are over they stop it? If they do that surely they are making a "financial advice" decision too? Madness.

Agreed "we cannot help you it is classed as financial advice" is complete nonsence...not their fault they have to follow the rules but still rubbish
Simply asking what is the limit you can make to stay within PSE - to me that is asking for straightforward information,no more no less.
If i asked what funds should i invest in that is advice
Whole system is made up of stupid rules
I am paying £108pw so that will have to go down soon

How did you go on with trying to stay within PSE? I've fallen out this week and I'm only paying £83 into Flexi plan plus Bonus plan. would appreciate a reply, many thanks.

[Hyrrokkin]

So, as promised I'm back. I rang the pensions office earlier and have to say they were not helpful one bit. In their eyes, telling me the maximum I can pay in to the AVCs and remain in PSE is financial advice. I even talked with someone in HR. Same answer. So, I know I'm pretty close to the limit right now. Paying £120.88 in total. I'll be chopping my contributions to £87.88 from April. No sign of a new pay deal and the minimum wage increases by nearly £1 per hour. Keep your eyes on your payments eveybody!

I assume if you are over they stop it? If they do that surely they are making a "financial advice" decision too? Madness.

Agreed "we cannot help you it is classed as financial advice" is complete nonsence...not their fault they have to follow the rules but still rubbish
Simply asking what is the limit you can make to stay within PSE - to me that is asking for straightforward information,no more no less.
If i asked what funds should i invest in that is advice
Whole system is made up of stupid rules
I am paying £108pw so that will have to go down soon

How did you go on with trying to stay within PSE? I've fallen out this week and I'm only paying £83 into Flexi plan plus Bonus plan. would appreciate a reply, many thanks.

I checked this week still withing PSE
I am still paying £108 Flexiplan and £2.88 Bonusplan
To be honest i get confused about all this but the moment still within the limit

[heapsy]

My flexi plan is only £83. Apparently it depends on the amount of overtime you do and your NET pay. Sounds very complicated. Still couldn't find out any exact formula.