If an employee opts out of their pension, you can refund their in-year pension contributions by overriding their pension values in UK Payroll.
Before you begin, make sure the employee has been opted out of the pension scheme. Pension refunds using this process are only supported for the current tax year.
- Open the relevant Employee record and select View employee pay records.
- Scroll to Pensions section and find the pension scheme you want to refund.
- Ensure you are in the most recent open pay period (not the pay period the pension was deducted).
- Select the three dots (...) next to Employee pension and select Override item value.
- Enter the amount to refund as a negative value, for example, -50.00, add a comment and select apply.
- Repeat the process for Employer pension, if applicable.
The pension YTD value will be reduced by the refund amount, and the refund will appear on the current draft payslip. The employer pension will not show on the actual payslip, but you will see this as a minus on the payslip preview.
Things to note:
- Make sure you enter the refund with a minus sign (-). A positive value will increase the YTD amount instead of reducing it.
- The refund can't reduce the YTD pension value below 0.00. If it does, you'll see the error: “The resulting YTD value can't be negative.”
- If a pension refund was already added manually to the draft payslip, remove it before applying the override to avoid refunding the employee twice.