If you are a member of the Money Purchase 2003 (MP03) Section, Pearson will pay double the amount you do (up to certain limits). The flexibility of the section also means that you can:
- choose to pay your pension contributions either directly from your salary, or through Salary Exchange. To check if this option is right for you, please read the Salary Exchange Guide - This link opens in a new browser window.
- choose the amount you pay in increments of 0.5% and get tax relief on your contributions. If you choose to pay your contributions through salary exchange, then you may also save on National Insurance contributions.
- change the amount you pay, between the minimum and maximum, monthly. Changes to your contribution amount can be made through Pearson Benefits - This link opens in a new browser window and usually take effect from the next month.
- pay Additional Voluntary Contributions (AVCs) (these are not double matched by Pearson, so only suitable if you are already paying at the maximum double-matched level). For more details go to Ways you can save more.
- pay in more when you reach certain age criteria shown below:
Money Purchase 2003 (MP03) Section
- Age: Under 30
You pay* (min) Pearson pays Total (min) 3% 6% 9% You pay* (max) Pearson pays Total (max) 5% 10% 15% - Age: 30 – 44
You pay* (min) Pearson pays Total (min) 3% 6% 9% You pay* (max) Pearson pays Total (max) 6% 12% 18% - Age: Over 45
You pay* (min) Pearson pays Total (min) 3% 6% 9% You pay* (max) Pearson pays Total (max) 8% 16% 24%
- Auto Enrolment (AE) Section
You pay* Pearson pays Total 5% 3% 8%
*You can choose to pay your pension contribution through Salary Exchange. For more information, please read the Salary Exchange Guide - This link opens in a new browser window.
If you are a member of one of the DB sections, find out which section you are in to see more details about your contributions.
Are you missing out on extra money?
Remember – Pearson pays in double! Here are some examples of how this affects the amount being paid into your pension pot each month.
Also, your pension contributions are taken out of your salary before tax, which means you pay no tax on them. Your tax relief is worked out automatically by payroll, so you don’t need to do anything. Go to Pay less tax for more information.
Basic rate tax payer (20%)
In summary…
Over the year, the total amount going into Laila’s pension pot is £2,250.00 at a cost to her of £600 a year after tax relief. If Laila chooses to pay their contributions through Salary Exchange, then they may also have reduced their National Insurance contributions, resulting in a higher take home pay.
In summary…
Over the year, the total amount going into Tom’s pension pot is £1,501 at a cost to him of £750 after tax relief. If Tom chooses to pay their contributions through Salary Exchange, then they may also have reduced their National Insurance contributions, resulting in a higher take home pay.
Higher rate tax payer (40%)
In summary…
Over the year, the total amount going into Yang’s pension pot is £6,300 at a cost to him of £1,260 per year after tax relief. If Yang chooses to pay their contributions through Salary Exchange, then they may also have reduced their National Insurance contributions, resulting in a higher take home pay.
In summary…
Over the year, the total amount going into Claire’s pension pot is £3,510 at a cost to her of £1,316 after tax relief. If Claire chooses to pay their contributions through Salary Exchange, then they may also have reduced their National Insurance contributions, resulting in a higher take home pay.
* The minimum contribution for MP03 members is 3% of Pensionable Salary whilst Pearson pay a minimum of 6% (depending on your age and contribution level this could rise to 16%). Members of the Plan can also pay their contributions through Salary Exchange. To check if this option is right for you, please read the Salary Exchange Guide - This link opens in a new browser window.
** AE Section members contribute 5% of Qualifying Earnings, with Pearson contributing 3% on this amount. AE Section members are also able to make their pension contributions through Salary Exchange.
If you choose to make your pension contributions through Salary Exchange, then you could also pay lower National Insurance (NI) contributions. As a result, your net pay could increase, while the amount of money invested in your pension pot remains the same. To check if this option is right for you, please read the Salary Exchange Guide - This link opens in a new browser window.
What’s the catch?
There is no catch. By becoming a member of the MP03 Section, you not only get more pension contributions and the option to save more than the minimum, you also get valuable death and ill health protection providing financial security for you and your family should the unexpected happen.
Would you like to join the MP03 Section?
Joining the MP03 Section is easy, just go to Pearson Benefits - This link opens in a new browser window and select this option.
To help you decide what you may need to pay now for a comfortable life after work, visit MoneyHelper pension calculator - This link opens in a new browser window to find out your likely retirement income.
Tax implications
Your contributions (including any paid through Salary Exchange) are paid tax-free, providing you are under HMRC’s Annual Allowance (AA).
What is the Annual Allowance?
The Annual Allowance is the maximum Pension Input Amount that can be paid each year into all your pension arrangements without incurring a tax charge. The standard Annual Allowance for the 2024/25 tax year is £60,000. However, it could be reduced to a minimum of £10,000 a year depending on your adjusted income.
Go to our Annual Allowance page for more information.
What does this mean for you?
The Annual Allowance will only affect you if you think your Pension Input Amount may have exceeded the £60,000 limit. If you think you might have exceeded the limits set by HM Revenue and Customs (HMRC) you may have a tax charge to pay. This is known as an Annual Allowance tax charge.
If we think that you have exceeded the Annual Allowance, then you will receive a pension savings statement to help you calculate whether you have exceeded the Annual Allowance. You will receive a pension savings statement if:
- your Pension Input Amount in the Plan has exceeded the standard Annual Allowance in 2024/25, or
- you have requested a pension savings statement
