The following table shows the minimum contributions that need to be paid. To help people (and businesses) adjust and plan, the rate will increase on a phased basis over 8 years.
| Year | 2024 | 2025 | 2026 | 2027 | 2028 | 2029 | 2030 | 2031 | 2032 |
| Employer | 1% | 1% | 1% | 2% | 2% | 3% | 3% | 3% | 3.5% |
| Employee | 1% | 1% | 1.5% | 2% | 3% | 4% | 5% | 6% | 6.5% |
| Total | 2% | 2% | 2.5% | 4% | 5% | 7% | 8% | 9% | 10% |
| Year | Employer | Employee | Total |
| 2024 | 1% | 1% | 2% |
| 2025 | 1% | 1% | 2% |
| 2026 | 1% | 1.5% | 2.5% |
| 2027 | 2% | 2% | 4% |
| 2028 | 2% | 3% | 5% |
| 2029 | 3% | 4% | 7% |
| 2030 | 3% | 5% | 8% |
| 2031 | 3% | 6% | 9% |
| 2032 | 3.5% | 6.5% | 10% |
Minimum pension contributions
Employees should be encouraged to contribute more when they can afford it, at different stages of their lives. For example, once their children have gone to school or when university fees stop. Even a minor increase can make a big difference over the long term, so even adding an additional 1% to an employee’s pension contribution will be amplified over the years.
Tax relief on pension contributions
Employees will be entitled to tax relief on pension contributions paid into YIP, or any other Secondary Pension Scheme. Tax relief on all pension contributions will be limited to the lower of 100% of taxable income or £35,000 per year. Further restrictions on tax relief will apply if the individual is subject to the withdrawal of personal and other tax allowances for high earners.