AUTO ENROLMENT: AUTO ENROLMENT ELIGIBILITY: PENSION ARE YOU READY?
A new system of pension in the UK introduced called Auto enrolment, where an employer will have to enrol all their staff into this new system of pension, starting from October 2012 until by February 2018 every company would have been enrolled.
However each company has starting date to implements the auto enrolment, to find out your staging date then login to www.thepensionsregulator.gov.uk/employers/staging-date.aspx
Who can be exempt from it
Those who can be exempt from auto enrolment are
• Anyone under 22 years old.
• Over pension age.
• Earning below £10,000 pounds
• One man company director ( Director for your own company)
However if any of the above wants to join the auto enrolment then they can including those
• Over 16 and under 22 years old
• Over pension age but under 75 years old
• Earning above the lower earnings and the trigger limits (£5,824 – £10,000) 2016/17
What is payable:
Well both employee and employer must make contribution towards the auto enrolment which is
Based on the qualifying earnings:
From staging date up to 5 April 2018 1% 1%
6 April 2018 to 5 April 2019 2% 3%
From April 2019 3% 5%
Qualifying earning is for 2016/17 will be earnings between £43000 less £5,824 = £37,176 therefore the contribution will be based on the £37,176.
Anyone can decide not to go with this auto enrolment if they wish to do so and opt out, but the employer will need to have this in writing by the employees in order to submit the legal requirement the pension regulator , and there will be no contribution by the employer to pay.
The government has set up a pension scheme called NEST (National Employment Savings Trust) is available for any company to use who they do not have their own pension scheme. A company can use any scheme but it must a qualifying scheme.