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Repair Windows errors before they cause bigger problemsFix Now →Fix the driver behind crashes, sound loss and screen glitchesFind Drivers →For a standard UK automatic-enrolment workplace pension in the 2026/27 tax year, the employer minimum is usually 3% of qualifying earnings. To calculate what is owed, identify the scheme’s contribution basis, find the employee’s qualifying pay for that pay period, subtract the applicable lower threshold, cap the result at the upper threshold, and multiply by 3%. It is not automatically 3% of the employee’s entire salary.
The calculation below follows the standard qualifying-earnings basis. A scheme using another pensionable-pay definition, a higher employer rate, salary sacrifice, or defined-benefit rules can produce a different amount. The employee’s scheme booklet or provider rules are decisive.
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The calculation in one formula
For a pay period, the statutory employer minimum under the standard automatic-enrolment basis is:
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Employer minimum = 3% × min(max(gross qualifying pay − lower limit, 0), upper limit − lower limit)
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Use the threshold matching the payroll frequency. “Qualifying pay” is not necessarily the same as headline salary: the scheme’s rules determine which earnings are pensionable, while the statutory qualifying-earnings band determines the amount in the standard calculation.
What each part means
- Gross qualifying pay: the earnings included for the scheme during that pay period.
- Lower limit: the portion of pay below this amount is excluded from standard qualifying-earnings contributions.
- Upper limit: qualifying pay above this amount is excluded from the standard band.
- 3%: the usual minimum employer share of qualifying earnings in an automatic-enrolment scheme.
Payroll should calculate the amount each payday, rather than simply dividing an annual estimate by 12. A period with no qualifying earnings, irregular pay, or a late adjustment must be handled under the scheme and payroll rules.
2026/27 thresholds you need
The Department for Work and Pensions retained the 2025/26 threshold values for 2026/27 after its annual review. The Pensions Regulator’s table gives these equivalents:
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1Clear out junk files and repair common Windows errors2Fix the driver behind crashes, sound loss and screen glitches3Repair Windows errors before they cause bigger problems| Pay frequency | Lower qualifying-earnings limit | Automatic-enrolment trigger | Upper qualifying-earnings limit |
|---|---|---|---|
| Annual | £6,240 | £10,000 | £50,270 |
| Weekly | £120 | £192 | £967 |
| Fortnightly | £240 | £384 | £1,934 |
| Every four weeks | £480 | £768 | £3,867 |
| Monthly | £520 | £833 | £4,189 |
| Quarterly | £1,560 | £2,499 | £12,568 |
| Half-yearly | £3,120 | £4,998 | £25,135 |
These are separate tests. The £10,000 annual trigger (or its pay-period equivalent) determines when an eligible worker must generally be automatically enrolled. The £6,240–£50,270 annual band, or the matching periodic band, determines the earnings used in the standard contribution calculation. Confusing the trigger with the lower limit can overstate or understate the amount owed.
First establish whether contributions should be due
Automatic enrolment generally applies when a worker is aged 22 to State Pension age, earns at least £10,000 a year, and normally works in the UK. Eligibility is separate from the arithmetic. A worker outside that category may still have a right to join or opt in, and the employer’s contribution duty can depend on the worker’s earnings and how they joined.
Questions to answer before doing the maths
- Has the employer automatically enrolled the worker, or did the worker opt in or join voluntarily?
- What was the worker’s age and earnings status when the relevant duty arose?
- Is the worker paid through UK payroll and normally working in the UK?
- Has the worker opted out, and if so, for which period?
- Is the pension an automatic-enrolment defined-contribution scheme or a defined-benefit arrangement?
Do not infer a contribution from annual salary alone if enrolment status is unclear. Check the enrolment notice, opt-in or joiner records, and the scheme’s rules.
Decide which earnings belong in the calculation
Under the usual qualifying-pay approach, the earnings list can include:
- salary or wages;
- bonuses;
- commission;
- overtime;
- statutory sick pay;
- statutory maternity, paternity or adoption pay;
- shared parental pay;
- statutory parental bereavement pay; and
- neonatal care pay.
This is a practical statutory list, not a guarantee that every scheme treats every payment identically. Some schemes use basic pay, total pay, or another certified basis instead of qualifying earnings. Read the scheme booklet or provider contribution rules before assuming that an allowance, bonus, benefit, salary-sacrifice amount, or reimbursement is included.
Bonuses and irregular pay
A bonus or commission paid in a particular payroll period can increase that period’s qualifying pay if the scheme includes it. Overtime can do the same. A one-off payment should therefore be tested in the period in which payroll treats it as earnings; do not spread it across the year unless the scheme’s rules require that treatment.
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Step-by-step: calculate the employer amount
- Confirm the contribution basis. Establish whether the scheme uses qualifying earnings, another certified basis, or defined-benefit rules. Find the employer rate and whether the employer pays more than the statutory minimum.
- Confirm the pay frequency. Select the weekly, fortnightly, four-weekly, monthly, quarterly, half-yearly, or annual limits that match the payroll period.
- Total the included gross earnings. Add the salary and any qualifying bonus, commission, overtime, or specified statutory pay included by the scheme.
- Apply the lower limit. Subtract the period’s lower qualifying-earnings limit. If the result is below zero, use zero.
- Apply the upper cap. Limit the result to the difference between the upper and lower limits for that pay frequency.
- Multiply by the employer rate. For the usual statutory minimum, multiply the capped amount by 0.03.
- Check payroll rounding and adjustments. Compare the result with the scheme’s rounding convention, any salary-sacrifice treatment, corrections from earlier periods, and the provider’s contribution schedule.
Worked examples
Monthly pay of £3,000
Assume a monthly-paid worker is in a standard qualifying-earnings scheme and the employer pays only the statutory minimum.
- Gross qualifying pay: £3,000.
- Monthly lower limit: £520.
- Qualifying amount: £3,000 − £520 = £2,480.
- The monthly upper limit is £4,189, so £2,480 is below the cap.
- Employer minimum: £2,480 × 3% = £74.40.
Under the usual 5% worker and 3% employer split, the total minimum contribution would be £198.40 before scheme-specific differences and rounding. The example assumes the scheme uses the standard basis and has no higher employer rate.
Monthly pay above the upper limit
If monthly qualifying pay is £5,000, the standard band is capped at £4,189 − £520 = £3,669. The employer minimum is therefore £3,669 × 3% = £110.07, not 3% of the full £5,000.
Monthly pay below the lower limit
If monthly qualifying pay is £500, it is below the £520 lower limit. The standard qualifying amount is zero, so the standard 3% employer minimum for that period is zero. That result does not by itself settle whether the worker has a right to join or whether a different scheme basis creates a contribution.
Annual-pay illustration
For annual payroll, the standard band is £50,270 − £6,240 = £44,030. If annual qualifying pay is £36,000, the standard employer minimum is £29,760 × 3% = £892.80 for the year, subject to the scheme’s payment method and payroll treatment. An employer paying monthly would normally calculate using the monthly thresholds instead of waiting for an annual reconciliation.
Handling unusual or changing pay periods
Use the row that matches the period actually covered by payroll. A worker paid weekly should not have a monthly threshold applied merely because the annual salary is stated monthly in an employment contract. Likewise, an annual salary estimate does not prove that a contribution was due in a particular period. If a period has no qualifying earnings, or payroll reverses or corrects an earlier payment, ask how the scheme rules require that period to be reported and whether a later adjustment is being made.
When pay is irregular, retain the payslip showing the payment date and the earnings components. The relevant question is how payroll and the scheme classify that payment for that pay period. Do not average a bonus, commission or overtime across several periods unless the written scheme rules say to do so. If the pay frequency changes, recalculate using the thresholds for the new frequency and check whether payroll has made a corresponding correction.
Minimum rates are not always the actual rates
For most automatic-enrolment defined-contribution schemes, the minimum total is 8% of qualifying earnings: at least 3% from the employer and 5% from the worker. The employer may contribute more than 3%. Some arrangements permit a worker contribution below 5% where the employer pays enough extra to satisfy the required total, but the scheme rules must support that structure.
Defined-benefit schemes commonly do not use this simple percentage formula. Their promised benefits, pensionable service, salary definition, and member contributions are governed by scheme rules. A payslip percentage cannot be compared fairly with a defined-contribution percentage without first identifying the scheme type.
When the money should reach the pension
GOV.UK guidance says deductions taken monthly must normally reach the pension scheme by the 22nd of the following month when paid electronically, or by the 19th when paid by cheque. The employer must also meet the payment date agreed with its provider each time payroll runs. A missed contribution should be backdated, and late or insufficient payment can lead to regulatory enforcement and a fine.
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For a dispute, record the payroll period, deduction date, amount shown on the payslip, amount actually received by the provider, and the provider’s agreed deadline. The provider’s transaction history is more useful than a payslip alone because it shows when money arrived and whether an adjustment was applied.
How to check what your employer owes from a payslip
- Identify the pay period and gross pay used for pension purposes.
- Find the scheme name and contribution basis in the enrolment material or pension portal.
- Check whether the payslip includes a bonus, overtime, commission, or statutory pay that the scheme should count.
- Apply the matching lower and upper limits from the table.
- Multiply the qualifying amount by the employer’s stated rate, not automatically by 3% if the scheme promises more.
- Compare the calculated employer amount with the payslip and the provider’s contribution record.
- Check whether salary sacrifice, tax relief, rounding, or a correction from a previous period explains a small difference.
Keep copies of payslips, enrolment notices, scheme booklets, provider statements, and correspondence. They establish which rule applied in each pay period.
Common reasons the figures do not match
The calculation used whole salary
Applying 3% to every pound of salary ignores the lower and upper limits under the standard qualifying-earnings basis. Recalculate with the pay-frequency band, unless the scheme expressly uses another basis.
The wrong threshold was used
Using the annual £6,240 lower limit against monthly payroll, or using the £833 monthly enrolment trigger as the contribution lower limit, produces the wrong answer. Select one row of the table and use it consistently.
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Review the scheme’s definition and the payroll period in which the payment was made. Included irregular earnings can change both the worker and employer amounts.
The employer rate is higher than the minimum
Many employers pay a contractual rate above 3%. Use the percentage in the employment or scheme documents when checking what is owed; the statutory rate is only the floor for a qualifying arrangement.
The pension uses a different basis
Basic-pay, total-pay, certified-basis, salary-sacrifice, and defined-benefit schemes can differ from the standard example. Ask the provider or payroll team for the written contribution definition rather than trying to reverse-engineer it from one payslip.
The payment is late
Compare the provider receipt date with the agreed timetable and the general 22nd-of-the-next-month electronic deadline. Ask the employer for a correction and backdated payment. Escalate through the provider and the Pensions Regulator’s employer-compliance routes if the issue is not resolved.
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Comparing two workers or two payslips
Headline percentages are meaningful only when the underlying basis is the same. Compare these items in order:
| Comparison point | What to verify |
|---|---|
| Status | Automatically enrolled, opted in, joined voluntarily, or opted out |
| Scheme basis | Qualifying earnings, another certified basis, or defined benefit |
| Pensionable pay | Whether bonuses, overtime, commission and statutory payments are included |
| Pay frequency | The threshold row used by payroll |
| Rates | Employer rate, worker rate, and any contractual amount above the minimum |
| Timing | Payroll period, provider deadline, and actual receipt date |
Using calculators and payroll software
The Pensions Regulator provides an employer contribution calculator, but the exact result depends on the pension scheme selected and its contribution basis. Employers should calculate contributions each payday and account for relevant additional earnings. Payroll software can automate recurring calculations, but it cannot choose the correct scheme definition for you; that input must come from the scheme or provider.
Why these thresholds matter nationally
The DWP’s 2026/27 review estimates total private-sector pension saving of £91 billion, up from an estimated £89 billion in 2025/26, and projects 16.9 million private-sector pension participants, around 39,000 more than in 2025/26. Those figures describe the wider system, not an individual entitlement. For the individual calculation, the operative facts remain the worker’s status, scheme basis, pay components, thresholds, rate, and payment timing.
In announcing the threshold decision, the DWP stated: “The Secretary of State has therefore decided to maintain the existing threshold values for 2025 to 2026 into the 2026 to 2027 tax year.” Recheck thresholds after each annual review because future tax years can change the numbers used in this calculation.
What to do if you believe money is missing
- Recalculate the disputed pay period using the scheme’s written basis and the correct threshold row.
- Ask payroll for the gross pensionable-pay figure, employer rate, worker rate, and any adjustment applied.
- Ask the pension provider for the contribution transaction and receipt date.
- Give the employer the specific period, amount, and rule that appears to be wrong, rather than making a general complaint.
- Request correction and backdating where a contribution was late or insufficient.
- If the employer does not correct the issue, use the scheme’s formal complaints process and seek guidance from the Pensions Regulator or an appropriate workplace-pensions adviser.
A short checklist for every pay period
Before deciding that an employer has underpaid, write down the pay period, pay frequency, scheme basis, included earnings, lower limit, upper limit and employer rate. Reperform the subtraction and cap, then compare the result with both the payslip and the provider transaction. Check whether the worker contribution shown is a deduction from pay or a net figure after tax relief, because the presentation can differ even when the underlying employer payment is correct.
For a recurring check, keep a simple month-by-month record of gross pensionable pay, the calculated employer amount, the employee amount, the date the provider received the money and any correction. This makes a pattern easier to demonstrate than a single disputed payslip. It also highlights whether a missing bonus contribution was corrected in a later period or remains outstanding.
Questions to ask payroll or the provider
Ask for the written answer to four points: which earnings definition applies; which pay-period thresholds were used; what employer percentage or contractual amount applies; and on what date the provider received the contribution. If the answer changes between payroll and the provider, request the calculation and remittance record for the same period. A precise question tied to one payslip is more likely to produce a useful correction than a request to “check the pension” generally.
Frequently Asked Questions
Is my employer paying 3% of my whole salary?
Not necessarily. Under the standard qualifying-earnings basis, the 3% minimum applies only to earnings between the relevant lower and upper limits. A scheme using basic pay, total pay, a certified basis or a higher contractual rate can produce a different figure.
Do bonuses, commission and overtime count?
They can count as qualifying pay when the scheme includes them. Test the payment in the payroll period in which it is treated as earnings, and check the scheme booklet because pensionable-pay definitions vary.
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Why is the monthly enrolment trigger £833 but the lower contribution limit £520?
They serve different purposes. £833 is the monthly equivalent used for the automatic-enrolment earnings trigger, while £520 is the lower limit used to calculate qualifying earnings under the standard contribution basis.
What if my monthly qualifying pay is below £520?
The standard qualifying amount is zero for that period, so the standard 3% employer minimum is zero. That does not decide whether you can join or whether another scheme basis requires a payment.
How do I calculate the contribution when pay is above the upper limit?
Subtract the lower limit from the upper limit to find the maximum qualifying band for that pay frequency, then multiply that band by the employer rate. Pay above the upper limit is not included in the standard band.
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When must the employer send the money?
Monthly deductions normally must reach the scheme by the 22nd of the following month when paid electronically, or by the 19th when paid by cheque. The provider’s agreed payroll timetable also applies, and missed payments should be backdated.
Can my employer pay more than 3% so I pay less?
An employer may pay more than the minimum. Some arrangements allow a worker contribution below 5% when the employer pays enough to meet the required total, but the scheme rules must permit that structure.
Does this formula apply to a defined-benefit pension?
Usually not. Defined-benefit schemes use rules about promised benefits, pensionable service, salary and member contributions rather than this simple qualifying-earnings percentage. Ask the scheme for its calculation method.
Should I use the annual threshold for a monthly payslip?
No. Match the threshold row to the actual payroll frequency. A monthly calculation uses £520 and £4,189 for the 2026/27 qualifying-earnings band, unless the scheme uses another basis.
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The Bottom Line
For a standard UK automatic-enrolment defined-contribution scheme in 2026/27, calculate the employer minimum as 3% of qualifying earnings between the applicable lower and upper limits. Confirm enrolment status, included pay, scheme rate and pay frequency first; then compare the result with the payslip and provider receipt. The scheme rules, not a headline percentage, determine the amount actually owed.
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