At the Sunflower Group we have a trusted network of partners and we actively share their thoughts, we are sure you will find the following insightful.
The government initiative for Auto-Enrolment pension schemes came into effect as of October 2012. Throughout the past five years employers across the country have reached their staging date, resulting in over six million people being auto-enrolled in their workplace pension. This is a great success story and means many more people are now saving for their retirement with a contribution from their employer.
This is not where it ends, employers have ongoing responsibilities.
The required contribution levels started low at 1% of salary for employees, matched by 1% from their employer. However, these contributions must increase from April 2018. At that point, the employee contribution before tax relief must be 3% of salary with 2% from the employer. Then in April 2019 the employee contribution before tax relief must be 5% with 3% from the employer. Therefore, if your business has already staged or is due to stage very soon, you need to start budgeting for the increased employer costs and also think about how you will communicate these changes to your employees so that they both value and understand the changes.
Also, every three years employers must complete ‘re-enrolment’. Your duties will vary depending on whether you identify that you have staff to re-enrol, or whether you have no staff to re-enrol. Either way, you will need to complete a re-declaration of compliance to tell The Pension Regulator how you have met your duties. Remember, re-enrolment and re-declaration is your legal duty and if you don’t act you could be fined.
LEBC Group Limited is a national firm of employee benefit and independent financial advisers. They can assist you with the complexities of auto-enrolment so you have the best option for your business and your employees. If you have already staged, they will also carry out a free, non-obligation review of your current scheme to ensure it remains the best option for you. If you would like to know more, please contact us and we will happily introduce you.