What are the minimum contribution levels when pensionable or total earnings basis is used?

When an employer has decided to use their own definition of pensionable pay (also known as self-certification), there are different minimum contribution levels. Employers should confirm which definition of pensionable pay they’re using and check which minimum contribution level applies to them.

If an earnings basis other than qualifying earnings is selected, self-certification is required every 18 months to confirm that the chosen basis meets the minimum requirements. You can find a template for this on the government’s website (Annexe E).

These tables are based on the relief at source method of claiming tax relief. Read more about tax relief on our website.

Pensionable earnings (set 1) –  contributions are worked out on at least basic pay.

Pensionable earnings (set 2) –  contributions are worked out on at least basic pay (but pensionable pay must make up at least 85% of total earnings). The employer must monitor this.

Total pensionable earnings (set 3) – contributions are worked out on total pay including wages, commission, overtime, bonuses, performance-related pay and any other earnings you’ve paid the employee.

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