Stakeholder Pension
By law any employer with five or more employees must offer a stakeholder pension scheme, which must be brought to the attention of all employees who must be given the chance to make an informed decision by seeking advice of an independent financial adviser.
Stakeholder pensions were made available from 6 April 2001, with the intention of increasing the number of people saving for retirement. They is be widely available from banks, insurance companies or building societies, amongst others.
If an employee’s contribution is currently £80, the pension administrators will add 20% tax relief and a total of £100 is paid into their plan. The Government are keen to make access to pension schemes much
easier. As a result, current legislation means that businesses
that do not already have a suitable pension arrangement in place
will have to offer access to a Stakeholder pension scheme for their
employees: Employers with 5 or more staff must now offer their employees
access to a stakeholders pension scheme. You must formally choose
the scheme from any commercial financial service pension company who
have registered their stakeholder pension scheme with the Inland
revenue and the Occupational Pensions Regulatory Authority (OPRA),
from 8 October 2001. Employee's statutory rights must be
incorporated in the employment contract.
Some Stakeholder Pension Providers
Employees Rights
Norwich Union
Scottish Widows
Legal & General
Standard
Life
Scottish Life
Prudential
From 6 April 2008 basic rate income tax will come down from 22% to 20%. This means less tax relief on the pension payments deduct from employees salary. The taxable pay on stakeholder pension will be 80% instead of 78%.
Some employers' may wish to set up company health insurance plans or medical cover with the same pension company reducing administration.
NHS Pension.
If you are a GP Practice. then the NHS Pension scheme must be offered unless the employee opts out by completing SD502 form. Suitable alternative occupation pension schemes can be offered. There are changes to the NHS Pension scheme effective from 1 April 2008 where a tiered contribution scheme will be in place.
If you no longer wish to administer the NHS Payroll and Pension, we are currently accepting new clients now. Existing clients of GP Practices can login to customer support for more information on the NHS Pension scheme members.
This page was last updated
08/04/2008
