Do I need to offer a company pension plan?
In the UK, all employers must auto enrol employees onto a company pension scheme.
So yes, you do need to offer a company pension plan.
There are many options available, and I would recommend you find the support of a financial adviser to find one that works for your business and your employees.
The minimum pension contribution is 8%.
A minimum of 3% of this paid by the employer, though they can choose to pay more.
Pension enrolment is a requirement for all employees over the age of 22, whether full or part time.
You may delay adding someone to a pension for up to 3 months, with good reason, but it cannot be beyond this.
Pension contributions can reduce employee tax, and both employee and employer NI depending on how they are set up. Which is why I strongly recommend a good financial adviser before deciding which provider to use, and what contributions to make.
Some typical examples of contributions I’ve seen -
Employer/Employee
3%/5%
5%/5%
3% matched to employee contribution up to 10%
21% - all employer!
It really varies, on how you set it up, and what support you want to give your employees.
Higher pension contributions are a great benefit to many employees.
There are a wide range of low cost, and great return benefits for employees for any small business to consider.
It can really set you apart as an employer, support talent attraction and long term retention - and it really doesn’t cost what you think it does.
Get in touch if you would like to discuss benefit options for your small business. We work with several partners and brokers to find you the best suited deals.
