What is Smart Pay?

Smart Pay, also known as salary sacrifice, is a tax efficient way to make contributions to your pension. With Smart Pay you will not make pension contributions into the Mercer Master Trust – IMI Retirement Savings Plan (the Plan). Instead, the Company will make the contributions on your behalf in addition to its employer contribution.

How does Smart Pay work?

If you join the Plan, you will automatically participate in Smart Pay at the contribution rate that you specify.

By participating in Smart Pay, you agree with IMI to ‘sacrifice’ an amount of your basic annual salary equal to your pension contributions in return for an additional IMI contribution to your pension of the same amount.

The benefit of Smart Pay is that your pension contribution is taken from your full base salary before any National Insurance Contributions (NICs) are taken off. This means your gross (pre-tax) salary is lower, so you pay less NICs, which often means your take-home pay is higher, but the overall contributions to your pension remain the same. IMI will also pay lower NICs.

Any IMI benefits, shift allowances, over-time pay, holiday pay, future pay reviews, bonus, etc., will be calculated in accordance with company rules and by reference to your pre-salary sacrifice pay. These changes will be automatically captured by Payroll and will be shown on your payslip.

Is Smart Pay right for you?

You can’t use Smart Pay if it could result in your income falling below the National Minimum Wage. In this circumstance, Payroll will automatically remove you from Smart Pay until this no longer impacts you, e.g. if you are on Statutory Maternity Pay.

There can also be an impact on salary-based benefits and your ability to borrow money due to Smart Pay giving you a lower overall income. Things to consider include the following:

• Your lower salary might affect the amount of money that you are able to borrow for a mortgage or credit card borrowing limits.
• Your entitlement to certain State benefits might be affected.

If you are unsure whether Smart Pay is right for you, you should seek independent financial advice.

Can I opt-out of Smart Pay?

If you want to join the Plan but you do not wish to benefit from Smart Pay, please complete the Smart Pay Opt-out Form