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Frequently asked Questions.

Auto-enrolment Frequently asked Questions.

 

What is Auto-enrolment?

Auto-enrolment is a government initiative that has been set up to help deal with the future pension crisis. Millions of people are not saving enough to have the income they are likely to want in retirement. Life expectancy in the UK is increasing and at the same time people are saving less into pensions. In 1901 there were 10 people working for every pensioner in the UK. In 2010 there were 3 people working for every pensioner. By 2050 it is expected that this will change to just 2 workers.

Does automatic enrolment affect me?

Are you an employer with staff working for you in the UK? If so, then yes, automatic enrolment does affect you and there are things you’ll need to do. It is important that as the employer you fully understand all the duties that are expected of you under Automatic Enrolment. For more information please speak to one of our advisors or visit: http://www.thepensionsregulator.gov.uk

Who should be automatically enrolled?

Automatic enrolment is the main employer duty under the new laws on workplace pensions. It’s called automatic enrolment because employers will need to enrol certain staff into a pension scheme ‘automatically’, without those staff having to do anything. You must automatically enrol everyone working for you:

  • Who is aged between 22 and state pension age.
  • Who works in the UK.
  • For whom you deduct income tax and National Insurance.

What is my Staging Date?

The new employer duties are being introduced over 6 years, starting with the UK’s largest companies in 2012. The date when the law is ‘switched on’ for your business is known as your ‘staging date’. 

Find out your staging date here: Click here

When does it all need to be in place by?

Every employer will have a date from when the automatic enrolment duties come into force for their business. This is called an employer’s ‘staging date’. Your staging date is the date the new duties come into force for your business. It’s the date from when automatic enrolment activities must become ‘business as usual’. Staging dates are based on the size of an employer’s PAYE scheme on 1 April 2012 – the more people in the PAYE scheme at that time, the earlier the staging date.

Find out your staging date here: Click here

What will automatic enrolment cost me?

Compulsory employer contributions are the main costs associated with the pension scheme. You’ll have to pay a minimum employer contribution for everyone you automatically enrol and anyone who opts in. The minimum contributions that you must pay into your staff’s pension scheme are shown below – they’re currently a total contribution of 2% with at least 1% employer contribution. Minimum contributions are being introduced gradually over time. You will usually pay pension scheme contributions either as a fixed amount or based on a percentage of earnings.

Auto enrolment costs

How much do I have to contribute?

Your minimum employer contribution 

You will have to make regular payments into the pension schemes of all staff who you automatically enrol and all those who choose to opt in. The law has set a minimum level for employer contributions. To work out the minimum amount you’ll have to pay for an individual staff member, you’ll need to know their gross earnings.  

To find out your minimum contribution amount:  Click here

 

 

What If I already have a workplace pension in place?

Many employers already make pension provision for their workers. If you want to use the existing arrangement to meet your workplace pensions duties for existing members who are eligible jobholders you will need to make sure that it is a qualifying scheme. In addition, if the employer wants to use the existing scheme to meet their automatic enrolment duties for workers who are not already members of a pension scheme, the scheme will also need to meet the automatic enrolment criteria.

How Sterling North can help.

Sterling North are an independent financial advisor firm based in Buckinghamshire. The advice given is based on the whole of market, which means we can find the best suited option for you and your business. Our advisors have all met strict regulatory requirements, proven to have a high level of understanding through examination and have many years of experience in the financial services sector. At Sterling North your allocated advisor will guide you through every step; from initial consultation and face to face meetings & workshops with employees to analysis and implementation of the best suited scheme, you will receive a plain speaking service, that is both time efficient and cost effective.—-

Sterling North Ltd is regulated by the Financial Conduct Authority (FCA). Our highly qualified advisors are professional, hardworking and 100% trustworthy. As Independent financial advisors we are here to work for you; not being tied into any products or services means that we can offer advice from the whole of market. At Sterling North we pride ourselves on our ability to build a strong working relationship with our clients, we do this through providing honest, straight talking advice based around your needs and requirements. In addition to helping you meet your auto-enrolment needs, we are also able to cover additional areas such as personal pensions, savings & investments, mortgages, life insurance, protection and inheritance tax (IHT) planning. The initial consultation is usually free and any costs will be explained up front. There is no rush to proceed, you are encouraged to take your time, and consider all the options that we have recommended. There are no pushy sales or hidden fees and anything you are unsure about will be explained in a jargon free manner.

If you would like to know more about us please feel free to:contact us.

To find out more information on work place pensions and auto-enrolment please visit:the pensions regulator