Your employer has to pay a minimum of 3% on what’s known as qualifying earnings into your pension pot. This is the band of earnings used to calculate minimum contributions. Under current legislation this is earnings between £6,240 and £50,270 for the current tax year. Qualifying earnings include salary, wages, overtime, bonuses and commission, as well as statutory sick, maternity, paternity or adoption pay.

If for example you’re earning £15,000 then your employer would need to contribute £15,000 – £6,240 = £8,760 x 3% = £262.80 a year. This means that your employer’s minimum monthly contribution is £262.80/12 = £21.90.