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Workplace Pension Estimator
Auto Enrolment · 2026/27 · Defined Contribution
What Is a Workplace Pension?
A workplace pension is a retirement savings scheme set up by your employer. Since the introduction of auto enrolment in 2012, virtually all UK employers must automatically enrol eligible workers into a qualifying pension scheme and make contributions on their behalf. This means if you are aged 22 or over, earning more than £10,000 per year, you are automatically enrolled. [web:114]
Unlike defined benefit (DB) pensions such as the NHS or Teachers' scheme, most modern workplace pensions are defined contribution (DC) schemes. Your final retirement income depends on how much is contributed (by you and your employer) and how well the investments perform over time — not a guaranteed formula.
How Auto Enrolment Works
If you earn above the £10,000 earnings trigger, your employer must automatically enrol you and contribute at least 3% of your qualifying earnings. You contribute at least 5%, giving a total minimum of 8%. These contributions are calculated only on earnings within the qualifying band — between £6,240 and £50,270 in 2026/27.
For example, a worker earning £35,000 has qualifying earnings of £28,760 (£35,000 minus £6,240). The minimum employer contribution is 3% of £28,760 = £862.80/year. The employee contributes 5% = £1,438/year, effectively costing only £1,150 after basic rate tax relief.
Auto-Enrolment Thresholds 2026/27
The Department for Work and Pensions (DWP) confirmed in January 2026 that all auto-enrolment thresholds remain frozen at 2025/26 levels for 2026/27. These thresholds determine who must be enrolled and what portion of salary contributions are calculated on.
| Threshold | Annual | Monthly | Weekly | Purpose |
|---|---|---|---|---|
| Earnings Trigger | £10,000 | £833 | £192 | Auto-enrolment required above this |
| Lower Earnings Limit | £6,240 | £520 | £120 | Bottom of qualifying earnings band |
| Upper Earnings Limit | £50,270 | £4,189 | £967 | Top of qualifying earnings band |
💼 Key point: Workers earning between £6,240 and £10,000 can opt in to their employer's scheme and — if they do — their employer must contribute at least 3% of their qualifying earnings. Workers earning below £6,240 can ask to join, but the employer is not legally required to contribute.
Minimum vs. Enhanced Contributions
While the legal minimum is 3% employer / 5% employee (8% total) on qualifying earnings, many employers offer higher contributions — especially to attract and retain staff. Some calculate contributions on total salary rather than just qualifying earnings, which can significantly increase the total pot over time.
| Structure | Employer | Employee | Total | Basis |
|---|---|---|---|---|
| Legal Minimum | 3% | 5% | 8% | Qualifying earnings |
| Enhanced (common) | 5% | 5% | 10% | Total salary |
| Generous | 8% | 5% | 13% | Total salary |
| Very generous | 10% | 5% | 15%+ | Total salary |
💡 Employer matching: Many employers offer to match employee contributions up to a cap — for example, "we'll match up to 5%." If your employer matches 5% and you contribute 5%, you effectively double your own contribution for free. Always contribute enough to get the maximum employer match — it is one of the best financial decisions you can make.