Workplace pensions

No matter what sort of business you’ve got…

And even if you have just one employee, they need to be enrolled in a workplace pension scheme.

That’s the law.

So, who needs to be enrolled?

Basically, UK-based employees who earn more than £10,000 a year…

…and are aged between 22 and the normal state pension age.

What’s the thinking behind this?

On its own, the maximum state pension adds up to an income of £8,767.20 per year for a single person. Now, this may not seem so big…

And your employees’ hopes for their future may be a good deal bigger than the kind of lifestyle the state pension could support.

A Workplace Pension scheme could help bring their plans together.

Without making life difficult for you.

Currently, it’s like this.

As an employer, you have to contribute. The legal minimum is 3%.

In some schemes, the employer has the option to pay in more than this.

If they do, the employee can pay in less as long as both contributions together add up to at least 8% of the employee’s total salary

Of course, the employer or the employee may decide to contribute more than the minimum amount.

Happily, the government do their bit, too – in the form of tax relief.

Because the money is invested, its value could go down as well as up, and the scheme member may not get back all that has been invested.

But the aim is to build a pot which could make a big difference to your employees’ future.

Setting up a workplace pension scheme needn’t be difficult. Your scheme provider should be able help you with training and support.

You need to be able to keep an eye on how your pension scheme is doing. You’ll normally receive regular reports from your provider to help with this.

When you’re considering a scheme, it’s also worth considering whether it will be compatible with your payroll software.

This could make your life quite a bit easier!