Advice on auto–enrollment by Stephen Nutter, Wheatley Financial Services
The Government estimates that about seven million people are currently not saving enough for their retirement. Now employers are being told to encourage their employees to save money. Over the next year or so, employers will be automatically enrolling all eligible employees into a qualifying pension scheme and make contributions to their plan.
What does this mean for you?
The legislation will be introduced in a staged process, dependent on the size of employer and type of scheme.
You can use your existing scheme to meet the new requirements, however it will have to meet certain qualifying criteria.
These changes raise a number of specific issues which could have a financial impact on your business, depending on how close your current pension scheme is to meeting the new requirements or you may not have an existing scheme at all.
What can you do now?
Although the legislation may not affect you today, now is the time to start making preparations for the changes, as it’s likely that there will be a financial impact on your business. There are steps you can take now to minimise this impact, for example:
Salary exchange (also known as salary sacrifice)
This can reduce costs by deducting the employee’s contribution from their salary before tax and National Insurance. This saves on National Insurance contributions for both the employee and employer, allowing a higher contribution to the pension at no extra cost to either.
Wheatley Financial Services can help by assessing your workforce for a detailed look at how to either adjust your current scheme to adapt to the new rules or to help implement a new scheme suitable for your business.
Contact pension specialist Stephen Nutter at Wheatley Financial Services, on 01282 699582, quoting Irish in Britain for more information. Stephen presented the new rules at Irish in Britain’s National Clubs Forum in April.