Pension Contributions are not as expected

Troubleshooting incorrect pension contributions

1. Go to Company > Pension Maintenance and select the relevant pension

2. Make note of the following settings:

3. Open and Pay the employee

4. Enter the Basic Pay, Additions and Deductions that are required for the calculation

5. When entering the additions and deductions, take note whether the elements are marked as ‘Pen’ and ‘QE’. If ‘Use Qualifying Earnings as definition of Pensionable Pay’ is ticked, as above, then you should be taking note of those marked as ‘QE’ otherwise, take note of the ‘Pen’ elements. 

You can check these from Open & Pay > Change > and clicking 'Create Addition'

6. Add Basic Pay + Additions + Deductions (where QE or Pen is ticked), this equals the calculation Basic Pay.

7. If the ‘Calculate EE/ER contributions on banded Qualifying Earnings’ is ticked, then you should next reduce the above calculated basic pay by the relevant thresholds. Generally (for 2021) this just needs to be reduced by 120 for weekly, 520 for monthly. If the employee is a high earner, you’ll need to take into account the upper band, also. 

8. Next, press Calculate and choose ‘More Info’, navigate to the ‘Deductions’ tab and you’ll have an ‘AE Pension’ value for EE and ER Pensionable Pay. This value should match the value calculated in steps 6/7.

9. Next take the Employee and Employer Percentages of this value to arrive at the final pension calculation amounts.