Once an employee has been enrolled in a pension scheme automatically, they have the option to opt out during the opt-out period.
In this article, you'll learn how to:
Opt an employee out of a pension scheme
- Go to Payroll and select Employees (Take me there).
- Select your employee that you want to opt out of the pension scheme.
- Under Pay Run Settings, select Pension Settings.
- Select Opt out of this pension scheme.
- Enter the opt out date and reference.
- Select Yes if you would like to refund pensions contributions for the employee.
Note: Refunds should only be applied within the opt out period. - Select Set and then Save.
Automatic collection of pension opt-outs through PensionSync
If you use PensionSync to submit employee pension information directly to the provider:
- The opt-out and cease contribution info is automatically updated in the employee record during pay-run creation. This information is then updated on the employee's payroll record.
- If an employee opts out, a refund will be applied in the first available pay run.
- If an employee ceases contributions, the contributions will stop from the effective date confirmed by the pension provider.
Note: PensionSync collects and stores up to 6 weeks of opt-out and cease contribution data.
Why has my refund not been processed?
If you're wondering why your refund hasn't been processed, there are a couple of things to check:
- The opt-out date should be within the current pay-run period.
- Make sure the employee is included in the pay run.
If you don't meet these requirements, you can manually calculate the employee pension contribution refund using the HMRC Adjustment feature.
More help
For more guidance on the opting out process, your can refer to the Pension assessment and re-enrolment and The Pensions Regulator.
Check out the QuickBooks Online Advanced Payroll hub for more helpful articles.