Stakeholder Pensions

Are you complying with the Law?

If you are a small employer you are faced with complying with a huge amount of legislation and frequently you do not have the knowledge or time to know if you are in breach of the law.

The legislation surrounding pensions has always been complex. In recent years the politicians have been making moves to encourage employees to save for their retirement. The first of these was the introduction of Stakeholder Pensions in 2001. These were low cost pension arrangements which were portable and could be taken from job to job and could be used to transcend different types of employment situation for example you could contribute whether you were employed or self employed. The Government wanted employees to have access to these schemes

Since October 2001 all employers with more than four employees who earn more  than the lower earnings limit (£97 per week for 2010/11)  have been required to designate a stakeholder pension arrangement to which employees can contribute. The employer does not need to contribute but must give the employee access to information on the scheme and deduct the premiums from his pay and forward them to the designated Insurance Company

Exemptions do apply if you are running an occupational ro Group Personal Pension to which he employee is eligible to join within 12 months of starting work and where the employer contribution is at least 3% of basic pay

If you are not complying with this legislation you could face a fine by the Pensions Regulator of up to £50,000.

Do you need help with providing pension benefits for your employees?

As a small employer, at present you do not need to make a contribution to a pension arrangement for your employees but you need to give them access to a scheme

As your business grows and you feel more financially secure you should consider putting in place a pension scheme for your employees. This does not need to cost a large amount of money but it is viewed as a valuable benefit when you are recruiting new staff

You will soon be forced into contributing to a pension arrangement for your employees because from October 2012 all employees in the uk earning more than £7,475 must automatically be enrolled in a work based scheme which can either be a private scheme or the new NEST arrangement.

Nicholls Stevens have been giving advice to employers on how to construct pension benefits for their employees for over 20 years. We are experts in this field and will charge a fee for our advice so you cn depend upon the advice being independent.

We think that in 2011 ALL employers need advice on how to offer workplace pensions for their employees. So please get in touch with us