What are the UK auto-enrolment thresholds?

What auto-enrolment is

Since 2012, every UK employer has been legally required to enrol eligible workers into a qualifying workplace pension and contribute to it on their behalf. Workers are enrolled automatically — they don't have to opt in — though they can choose to opt out within a defined window.

The duty applies to every UK employer with at least one worker, however small. Phased rollout completed in 2018; the policy is now mature and the rules are stable.

The three thresholds you actually need to know

Auto-enrolment uses three figures that together determine who must be enrolled and how much must be contributed. The current values (2024–25 tax year) are:

• Earnings trigger — £10,000 a year. A worker earning above this must be auto-enrolled if otherwise eligible.
• Lower qualifying earnings — £6,240 a year. Pension contributions are calculated on earnings above this floor.
• Upper qualifying earnings — £50,270 a year. Pension contributions are calculated on earnings up to this ceiling.

The thresholds are reviewed each tax year. They've been frozen recently but historically have moved with NIC bands. Always verify current values on gov.uk before processing payroll.

Who must be auto-enrolled

A worker must be automatically enrolled if all four conditions apply:

• They are aged at least 22
• They are below State Pension age
• They earn over the earnings trigger (£10,000)
• They ordinarily work in the UK

Workers outside this set still have rights — see below.

Workers outside the auto-enrolment age band

There are two further categories:

• Non-eligible jobholders — workers aged 16–22 or above State Pension age (up to 75), or earning between £6,240 and £10,000. They are not auto-enrolled but they have the right to opt in, and the employer must contribute if they do.
• Entitled workers — workers earning below £6,240 a year. They can ask to join the scheme, but the employer is not required to contribute (though many do).

The distinction matters because each category triggers different employer duties — assessment, communication, opt-in handling, contributions.

Minimum contributions

The total minimum contribution is 8% of qualifying earnings, split:

• 3% employer (minimum)
• 5% worker (including basic-rate tax relief paid by HMRC)

The 5% from the worker is gross. If the scheme uses relief at source, the worker pays 4% net and HMRC adds 1% as basic-rate relief. If the scheme uses net pay arrangement, the full 5% is deducted from gross pay before tax.

Higher-rate taxpayers can claim additional tax relief through Self Assessment — which the employer is not responsible for handling.

Qualifying earnings band

Contributions are calculated only on the slice of pay between £6,240 and £50,270. Pay below £6,240 and pay above £50,270 are excluded from the calculation.

A worker earning £30,000:

• Qualifying earnings: £30,000 − £6,240 = £23,760
• Worker minimum: 5% × £23,760 = £1,188
• Employer minimum: 3% × £23,760 = £713

Total minimum contribution: £1,901 a year.

Note that the employer can choose to contribute on full salary rather than just qualifying earnings — many do. The 3% is the legal minimum, not the only option.

Earnings included

Qualifying earnings includes:

• Basic salary or wages
• Overtime pay
• Bonuses and commission
• Statutory sick pay
• Statutory maternity, paternity, adoption, and shared parental pay

It does not include:

• Benefits in kind (private medical, company car)
• Employer pension contributions
• Reimbursed expenses
• Termination payments

The duty start date and ongoing duties

For new employers, the duty start date is the date the first worker is engaged. From that date:

• Assess every worker on every payroll date
• Auto-enrol eligible workers who haven't already opted out
• Apply contributions from the first qualifying pay date
• Provide written information to enrolled workers within six weeks

For existing employers (most of the UK), the duties are continuous — every payroll cycle, every new starter, every change in earnings or age must be assessed.

Opt-out window

Auto-enrolled workers have a one-month opt-out window from the date they're enrolled. If they opt out within this window:

• They receive a refund of any contributions deducted
• They are treated as never having been enrolled

If they opt out after the window, they cease active membership but contributions already made stay in the scheme.

Re-enrolment every three years

Every three years from the original duty start date, all eligible workers who previously opted out must be re-enrolled. They can opt out again — but the employer must give them the chance.

Re-enrolment is staged across a three-month window chosen by the employer. The Pensions Regulator must be notified via a re-declaration of compliance.

The Pensions Regulator and compliance

The Pensions Regulator (TPR) enforces auto-enrolment. Key obligations:

• Declaration of Compliance — within five months of the duty start date
• Re-declaration — every three years on re-enrolment
• Maintain records — for at least six years
• Communicate to workers — written assessment letters within six weeks of enrolment

Late or missing declarations trigger automatic penalties starting at £400, escalating from £50–£10,000 daily depending on employer size. Knowingly non-compliant employers can face criminal prosecution.

Choosing a scheme

The scheme must be a qualifying scheme under auto-enrolment rules. Most UK employers use one of:

• NEST (the government default — accepts every employer)
• The People's Pension (master trust)
• Smart Pension (master trust)
• Aviva, Standard Life, Scottish Widows (group personal pensions through insurers)

The scheme's investment options, charges, and member experience vary. NEST has a 1.8% contribution charge plus 0.3% annual management — competitive for default funds but not the cheapest.

Putting it into practice

A robust auto-enrolment process should:

1. Assess every worker on every pay date against the three thresholds
2. Enrol eligible workers automatically and send the statutory communication
3. Process opt-outs within the one-month window with a contribution refund
4. Track non-eligible jobholders for opt-in requests
5. Re-enrol every three years and submit the re-declaration
6. Keep contribution records for at least six years
7. File the Declaration of Compliance with TPR on time

The thresholds are simple. The real challenge is doing the assessment every payroll cycle without missing edge cases — workers turning 22 mid-year, salary changes that cross the trigger, bonuses that push someone over the threshold for one period only. Automate it.