Pensions
Are you ready for the 2012 pension change?
Employers and employees will be affected by auto-enrolment. Under the Pensions Acts of 2007 and 2008, every employer in the country must “enrol” qualifying employees into a pension scheme.
The background
The pension and retirement landscape is changing. Many people will have to work beyond 60 or 65, and the state cannot continue to fund people’s retirement. From 2012, the onus will be on employers to ensure that their employees save for their retirement, with a “Qualifying Workplace Pension Scheme” or QWPS. The employer can establish a scheme or enrol employees in a national (but privately run) scheme called “NEST” (National Employment Savings Trust), previously known as “Personal Accounts”.
What are the costs?
Employers will have to contribute a minimum of 3% of salary between “band earnings” (£6,475 - £40,040 for 2009-10).
The minimum total contribution is 8%, so if the employer pays 3%, the employee must pay the balance of 5% (of which 1% will come directly from the tax-man). If the employer pays above the minimum, the employee pays less.
How La Playa can help?
These changes have wide-ranging implications for businesses, both large and small - not least adding to the direct costs of the employer and employee. If you’d like help preparing your business for 2012, contact me for further information, or read our employer guidance.
Mike Palmer Dip PFS
Financial Services Manager
mike.palmer@laplayainsurance.com
 | Talk to me on 01223 200674 |
 | Download National Employment Savings Trust - 2012 Employer Guidance |
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