Description

It may be the case that payees want to increase their pension contribution that is greater than the defined percentage set for the scheme. A pension provider may not offer the ability to send AVCs (Additional Voluntary Contributions) and the AVC amount is based on all pensionable earnings rather than within the qualifying earnings.

Therefore, an enhancement has been added that a user can now apply a deduction to specify the override contribution percentage.

Where the payee wants to continue with the default contribution, there is no need to add a deduction, the system will operate as it did before.

With this change the following areas have been updated:

• The pay batch process will use this value in the deduction stages to determine the pension contribution. This override percentage value will be used irrespective of whether an adjustment timesheet is received for a prior period to when this change occurred. This is because the pension provider can only process the percentage from current period and adjustments for prior periods cannot always be made.

• The Payee Pension Contribution report outputs the percentage used for each pay batch

• For NOW:Pension provider and The People’s Pension, the override rate will be output in the file that is sent.

• For Nest, the percentage is not sent on the file.

• If a payee withdraws or opts out of the pension and they have a pension percentage override, the system will automatically end the deduction with the date of the last pay period end date.

Benefits

Allows more flexibility in operating a workplace pension scheme.

Configuration

To apply the override percentage contribution:

Step	Description

Step	Description
1	Once the payee record who requires the different percentage has been opened and is in edit mode, click ‘Add’ in the Deductions sub-section. The Deduction Details screen will open.	Open
2	Enter the validity start date of when the pension percentage override should start. It can only be from the current pay period start date or later.	Open
3	Select the pension deduction that the payee’s pension scheme is linked to in the Deduction field. The following validations are applied when added a payee pension percentage override: If there are multiple deductions for different schemes that exist in your system, the system will validate that the pension deduction that is selected is relevant to the pension scheme. You can only apply 1 pension deduction per scheme assigned to the payee. If the scheme has ended already, you cannot apply an override contribution.
4	Enter the percentage rate required in the Rate Value field. The following validations are applied when editing the Rate Value: The value entered cannot be below the default rate set up on the deduction header. It must be the same or more.
5	Save the changes.