A while back, the government decided that all employers had to provide a workplace pension for their employees, and contribute towards that pension. Your employer has chosen NOW: Pensions to run the workplace pension at your company. Watch this short video to find out more about how this benefits you.
Why have a pension
You may already know that pensions are a very tax-efficient way of saving. If you are an income tax payer, any tax you would normally pay on contributions you make into your pension is added to your pension pot by the government.
Your employer contributes too
While you are saving with NOW: Pensions, your employer may also contribute into your pension pot. This money is put into your personal pension account and is in addition to your normal pay.
Tax-free growth on your savings
You might also like to know that any growth in the value of your pension between now and your retirement will not be taxed. So, your pot will grow tax-free, regardless of your own tax position. You only pay tax on your pension savings when you take them as an income.
Automatic tax relief on your contributions
NOW: Pensions operates a net pay arrangement. This means that your pension contributions are collected before income tax. So, if you’re a basic rate tax payer and you want to contribute £75 a month to your pension, £60 of your contribution comes directly from your pay, the additional £15 is the tax you would have paid on your £75 contribution. This means for income taxpayers, full tax relief at the highest rate is applied automatically and no income tax is paid on the contributions to your pension.
If you do not pay income tax you may be eligible to receive our top up - you can find more information about this here.