Last year I was auto enrolled into a pension by my employer. Only 1% of my net pay and this was shown on my pay slips, during the annual review without any comment from the IP.
I was wondering what is deemed an acceptable amount of someone's net wages to be paid into a pension whilst in a IVA. 5% 10%?
The Reason I ask....
Our family income is quite modest and we receive Tax Credits.
My employer offers Salary sacrifice pension contributions.
If my pension contributions deducted from my Gross (before tax), I obviously pay less tax NI and student loan, but I also receive an increase in TAX credits.
The resultant effect is a very small reduction in Net household income will massively increase the amount paid into the pension.
Whilst we don't have a much to contribute, and obviously don't want to cause any detriment to the IVA, we do want to maximise pension contributions where possible.
We want to keep the (effective) % reduction in total Net income to an accepted amount eyes of IVA (if there is such a thing)?
I do not believe there is any hard and fast rule (or, indeed, ANY rule). A lot depends upon the nature of the scheme and how long you have been in it, as well as your potential to catch up after the IVA, when your situation has dramatically improved.
Usually you would be expected to stick near the scheme minimum for payments and some IPs require you to opt out entirely. If you have a sympathetic IP it might be worth a chat, but, on the other hand, if he / she is a sleeping bear you don't want to be waving sharp sticks around!
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
I was allowed to maintain my contributions in full (deducted at source from my salary) and the contributions were quite high (can't remember the exact percentage now) and this was never questioned.
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The greatness of a man is not in how much wealth he acquires, but in his integrity and his ability to affect those around him positively.
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I might be lucky to have got away with the auto enrol thing to start with...