I have been reading about the UK workplace pensions schemes but I don't understand them very well.
What I have read is that you can choose an amount of money, which is taken from your gross salary, and it's put inside the pensions scheme. In addition, you are supposed to get a tax relief on this money, and your employer also puts money to do the 'matching contribution'.
These two last things are those that I don't understand very well.
1 - Your employer contributes with some money as well, but where does this money come from? Is it taken from your salary? If not, being in a workplace pension scheme means effectively earn more money, doesn't it? This sounds impossible to me, there must be something I'm not getting. That would mean that if you reject the pension scheme, you are effectively reducing your own salary. This sounds crazy. If this is the case, can you (legally) ask your employer for the 'matching controbution' to be added to your salary?
2 - With regards to the tax relief, it's true that your contribution is taken before paying the income tax. But, when you take your money back, do you need to pay income tax again? I see this would be beneficial if you avoid a high income tax rate and end up paying a lower one, but this still would be tax deferral, not relief, right?