Pension schemes

Every small business needs to offer qualifying employees a pension. But what are the rules as to who qualifies and how do you set one up?

How do we go about setting up a staff pension?

Since the introduction of auto-enrolment into pension schemes by the UK government, all employers must offer access to a pension scheme for eligible employees and make minimum contributions (currently 3 per cent) to it.

Pensions are complex, and you want to get it right. Getting expert advice on which scheme to choose is going to be important, a financial advisor will be able to help you with this.

Once you’ve identified the right scheme for you, you need to identify those you are going to offer access to it. The following employees are eligible:

  • Those between the age of 22 and the State Pension age
  • Earning at least £10,000 a year
  • Normally working in the UK

If you have employees who should already be in the scheme, speak to them about it and what you will be introducing – the pension provider will usually help you answer any of their questions.

>See also: Pensions auto enrolment guide for employers

Standard information for new starters should be available from the pensions provider to introduce them to the scheme you have selected, and you can get them enrolled as soon as they are eligible.

For more information visit The Pensions Advisory Service.

Peter Done is managing director and founder of HR consultancy Peninsula

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