1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
60
61
62
63
64
65
66
67
68
69
70
71
72
73
74
75
76
77
78
79
80
81
82
83
84
85
86
87
88
89
90
91
92
93
94
95
96
97
98
99
100
101
102
103
104
105
106
107
108
109
110
111
112
113
114
115
116
117
118
119
120
121
122
123
124
125
126
127
128
129
130
131
132
133
134
135
136 
From October firms with more than five staff will have
Page 40
If you've noticed an error in this article please click here to report it so we can fix it.
to offer pension provision. Don't worry, plenty of free advice is available and the pension provider will handle most of the paperwork.
IFram next month every firm with five or more employees will be obliged to introduce a staff pension scheme—failure to do so could mean a fine of up to £50,000. The arrival of stakeholder pensions on 8 October means its time to act without delay.
Stakeholder pensions—the new type of pension available since 6 April this year—offer your staff a simple, low-cost, flexible option. However, if you already have a pension scheme in place you do not need to act., and the rules are not as draconian as they sound.
Providing access to a stakeholder pension—and that is literally all you have to do—doesn't have to cost you anything. You don't have to run the pension scheme; you don't even have to set it up.
EL All you have to do is choose a scheme
03
• provider after consulting your staff, and c' allow them to contribute directly through u,
E
s., the payroll if they choose, You don't have ....
= to contribute to your employees' stake ▪ holder pensions. s.
▪ The first question to ask yourself is;
D
holder pension scheme, or is my business exempt?" To find out if you are exempt try using the "decision tree" for employers on the Occupational Pensions Regulatory Authority (OPRA) website at www.stakeholderopragovukidecisiontree.
Alternatively, take a look at the gov
ernment's booklet Stakeholder Pensions—an Employer's Guide. You can get a free copy from the Inland Revenue Employer's Drderline on 0845 764 6646, or print a copy from the DWP website at www.dss.gov.uk/publications/dss/2000/s takeholder_emp/sp_employerpdf.
One easy way to pick a scheme is to look at the stakeholder pension register on OPRA's stakeholder website, www.stakeholderopra.govuk/registrysearch,asp, or get a free copy of the register by phoning 01273 627600.
The most important thing to remember is that the stakeholder scheme you choose must be a registered scheme.
If your situation is particularly complicated, or you really can't face doing it yourself, you could talk to an independent financial adviser (IFA)—but make sure you talk to several, so you don't end up paying too much, Don't assume you have to use an IFA—many pension providers will do the work for you at no extra charge.
The whole point of stakeholder pensions is that. they have to meet certain conditions controlled by law. Members can transfer from one stakeholder pension scheme to another without penalties or extra charges. This means that if you want to change your scheme later, your employees can move the funds they have already built up to the new provider without incurring any costs.
You'll need to discuss your choice of scheme with your staff. You could: • Set up a meeting and invite your chosen pension provider; • Use your staff magazine or newsletter; • Talk to staff or union reps; • Distribute scheme literature from the pension provider you're considering; • Put up a notice on your company notice board and ask staff to let you know if they have any comments on your choice of scheme.
However you do it, your staff should be told about your plans and given the chance to express their views. Once you've consulted your staff you'll be free to designate your stakeholder pension scheme. Give your staff details, including name and contact information. Your pension provider should be able to supply literature for you to distribute.
Remember that your pension provider will probably do most, if not all, of the donkey work involved in setting up the scheme and explaining it to members. However, if your employees ask you to, it is your responsibility to set up a payroll facility to deduct contributions from their pay and send them to the scheme provider on the due date.
Your payroll system might already be set up to deal with deducting pension contributions. If not, some stakeholder pension providers may help you to set up a payroll deduction system as part of their service.
This is something to consider when choosing your provider.
Remember that you are responsible for paying contributions on time. Take a look at OPRA's A quick guide for employers about contnbutions to personal pension and stakeholder pension schemes so you know what you have to do (it's on the Opra website at www.00ra.gov.uk, or call 01273 627600 and ask fora copy).