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April 30, 2020
Question

Quickbooks Online is not calculating the Pension Contributions correctly

  • April 30, 2020
  • 1 reply
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Quickbooks Online is not calculating the Pension Contributions correctly.

Although I have put them in at 5% for the employees and 3% for the employers contributions.

1 reply

AlcaeusF
April 30, 2020

Welcome aboard to the Community, @Valerie156.

 

I can get this sorted out in no time. There are two sections in QuickBooks Online that we can check to ensure it calculates correctly.


First, we'll need to check the setup of the contributions from your employee's settings. Here's how:

 

  1. Go to Employees from the left panel. 
  2. Select the Employees tab. 
  3. Choose the affected employee. 
  4. Go to Auto enrollment section. 
  5. Check the percentage under Employee’s contribution and Employer contribution.

Once done, you can proceed with reviewing the taxation method that was selected. Please follow these steps:

 

  1. Click the Gear icon at the top. 
  2. Select Accounts and Settings. 
  3. Choose Payroll. 
  4. Go to Pension scheme section. 
  5. Check the taxation method. 
  • Net pay arrangement – pension contribution is deducted before taxes and NICs.
  • Relief at source – including tax relief – pension contribution is deducted after deducting tax and NICs, that is the pension contribution is from the employee’s net pay.
  • Relief at source – excluding tax relief – pension contribution is deducted after deducting tax and NICs, that is the pension contribution is from the employee’s net pay. However, the employee pays the entire 1% employee contribution.

Since there is a certain threshold before you get deducted, the pension calculation will base on your salary on that specific pay run. For more information, you can also visit this link: The Pensions Regulator.

 

For additional information, I've attached some articles about workplace pensions:

 

Please know that I'm just a post away if you have any other questions. Have a great day ahead.