Workplace Pension Auto-Enrolment UK: A Beginner's Guide
Opting out of your workplace pension is the most expensive 'pay rise' a UK worker can give themselves. The employer match you forfeit doubles your effective contribution.
Auto-enrolment 2026/27: who pays what
| Component | Rate | On a £30k salary |
|---|---|---|
| Employee contribution | 5% (4% net of tax relief) | £951/yr |
| Employer contribution | 3% | £713/yr |
| Tax relief at basic rate | 20% added back | £237/yr |
| Total going into your pot | 8% of qualifying earnings | £1,901/yr |
Qualifying earnings band: £6,240-£50,270. Opting out forfeits the 3% employer match - a guaranteed 100% return.
Key takeaways
Auto-enrolment requires UK employers to enrol workers aged 22+ earning above £10,000/year into a workplace pension
Minimum total contribution is 8%: 5% from you (gross of tax relief), 3% from your employer
Opting out forfeits the employer match - effectively giving up free money equal to 3-10% of salary depending on the scheme
Above the auto-enrolment minimum, many employers offer matched contributions up to 5% or more - always max the match