Government reviews pension enrolment guidelines
The UK government is believed to be reconsidering the level at which employees in the UK would be automatically enrolled into a pension scheme as well as a potential exemption for small companies. The original changes, which would see hundreds of thousands of employees in the UK automatically enrolled into pension schemes, are set to come into play in 2012 although we may see some changes to the original guidelines before then.
The proposed changes could see the threshold for joining such schemes increase from £5,000 per annum to anywhere from £10,000 per annum. The main concern of the government seems to be the possibility that a very small pension fund would in reality simply replace means tested benefits and be of little assistance to low-income workers in the UK. Whether this is the case remains to be seen but the authorities are certainly reconsidering their initial recommendations.
A number of authorities in the UK representing small businesses have been lobbying the government for some time for exemptions for those with fewer than five employees where potentially the cost of setting up the arrangements becomes "non-cost-effective". We are likely to see major changes between now and the proposed introduction date of 2012 with a number of different authorities and bodies around the UK lobbying the government for a number of changes.
Retirement not on the cards for wealthy UK individually
A report by Barclays Bank has today indicated that around 60% of wealthy individuals in the UK have no plans to retire and will indeed work on into their later years. It would appear that more and more the traditional retirement age is being cast aside and indeed the concept of retirement is something which many people are not willing to consider. This comes at a time when the UK government is...Read More
Is David Cameron right to attack public sector pensions?
Over the last couple of days we have seen some momentous decisions regarding public sector pensions which on the surface appear fairly innocuous but will have major consequences for those working in the public sector. Some doomsday scenarios suggest that by changing the inflation index from the retail price index to the consumer price index some public sector workers could see their pension paymen...Read More
Pension U-Turn Is Broadly Welcomed
As we covered some days ago, the UK Treasury had been looking to back date a new and controversial tax on small pensions in the UK. The move is set to hit over 420,000 people who have retired, many of whom had not expected to pay any tax on their small pension payments. Initially the move was to be back dated to 2007/8 but it will now start in the current tax year, 2008/09.
FTSE 100 companies see pension deficits increase
In another blow for the UK pensions sector it has been revealed that the cumulative deficit of FTSE 100 company pension schemes has increased from £41 billion in August 2008 to a massive £96 billion today. This is by far and away the largest cumulative pension deficit ever seen in the history of the UK pension industry and is starting to cause significant concern in corporate circles.
Contributions to pension schemes are made net of tax relief. This means you'll only actually contribute an amount of the total contributions paid to the pension. Higher rate taxpayers likewise make contributions net of basic rate tax, but can also then claim additional relief via their Inspector of Taxes/Self Assessment return. Your pension contributions will be based in funds where there is no...Read More