Pensions reform has arrived, and affects all employers and employees in the UK. This is often referred to as “Auto Enrolment”.
The new employer duties came into force on 1 October 2012. Under these duties, employers have to:
- enrol eligible workers into a qualifying workplace pension arrangement;
- choose the qualifying scheme(s) they adopt to discharge the newly arising duty; and either
- make a minimum 3% contribution towards a defined contribution scheme (based on qualifying pensionable earnings) or NEST (the National Employment Savings Trust); or
- offer membership of a defined benefit scheme or certain hybrid scheme which either has a contracting out statement or meets the test scheme standard.
An eligible worker is an employee aged between 22 and state pension age and earning above the income tax personal allowance. Contributions are payable from your qualifying earnings. For up to date allowances, please click here.
The date to have a scheme in place depends on the number of employees you have.
The earlier you plan, the better your chances of complying with the new legislation and keeping your business finances in good health. We will work with your Accountant to ensure you have a solution that’s right for your business.
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