Low paid at risk of auto-enrolment exclusion, Ros Altmann warns

Speaking the Trades Union Congress (TUC) pension conference, Ros Altmann explained employees on low incomes could lose as much as 20% to 25% in tax relief on their contributions depending on how their funds are set up. She explained low earners could lose up to a quarter on their tax relief entitlement if their contributions were calculated on 'net pay arrangements' where gross contributions are deducted from pre-tax pay. This compares with the 'relief at source' method where net contributions are deducted from post-tax pay. One advantage of relief at source is that low earners, ev...