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Employer Pension Schemes

Employer Pension Schemes (Auto Enrolment)

Every employer must have a pension scheme in place with the facility to manage all employees to automatically enrol or opt-out of the scheme every three years. This can be a huge administrative task, with large penalties for getting it wrong.

By working with you and your business, our advisers can help to reduce the burden of auto-enrolment.

Furthermore, we can continue to monitor the scheme and provide on-going advice to you and your employees to help them get the best out of their pension. Not only is it a requirement to have a pension scheme in place, but a well-managed scheme can help to encourage staff loyalty within your company.

Our advisers can help guide you through the whole process of setting up your pension scheme or review your existing pension scheme to ensure that it remains suitable. It is important that you understand your automatic enrolment duties, the impact on your business and the required changes you will have to make.

At our first meeting, we will aim to understand the needs of your business and your employees, taking into consideration the budget and relevant legislation. After this meeting and researching the whole of market, we can formulate a strategy that suits your business to ensure you have a compliant auto-enrolment scheme in place.

We will also explain your options with regard to salary exchange, the possible benefits this can have, and the potential savings it can make for your business.

The Pensions Regulator is the statutory regulator for Workplace Pensions.

Auto Enrolment is not regulated by the Financial Conduct Authority.

Contact us to find out more.

Salary Exchange

Salary Exchange is becoming more popular as it is a very effective way of Employers reducing their National Insurance contributions for both the Company and the employee.

Salary exchange is an arrangement between an employer and their employee where the employee agrees to a reduction in their contractual salary in exchange for a benefit of an equivalent value provided by the employer, in the form of employer pension contributions.

As the salary is being exchanged rather than paid directly, the Employer pays less National Insurance contributions and the employee pays less tax and National Insurance contributions.

Please note:

  • Payslips need to display the amount of salary exchanged.

  • HM Revenue & Customs take an interest in how tax and national insurance contributions are affected and have published a full set of salary exchange guidelines on their website.

  • An employee’s entitlement to statutory benefits may be affected by their reduced gross salaries and so the employer needs to make employees aware of how they may be affected.

  • An employer may want to retain a notional salary for employees (this is the salary before exchange),  so employee’s pre-exchange salaries may be taken into account by mortgage lenders and when entitlement to other salary-related benefits are calculated.

Information is based on our current understanding of taxation legislation and regulations.  Any levels and bases of, and reliefs from taxation, are subject to change.

Tax treatment is based on individual circumstances and may be subject to change in the future.

Contact us to find out more.

Business Assurance

Business Assurance deals with protecting your business from the adverse financial effects of the death of a key person, partner or shareholder. Business protection can be especially important to smaller companies whose reliance on key individuals for profit may be greater than larger companies.

There are two main types of business assurance: Key Man Assurance and Partnership Assurance /Shareholder Protection.

Key Man Assurance

This is used to inject a lump sum of cash into a business in the event of the loss of a ‘key person’. A key person may be a top salesman, or a key designer in a design company etc, someone whose death would have a direct and adverse effect on the companies income. The usual solution is a term assurance policy whose sum assured should be worked out with your financial adviser.

Partnership Assurance and Shareholder Protection

This deals with protecting the families and co-owners in the event of the death of one of the partners or directors. Each party agrees beforehand the value of his or her share and a combination of term assurance policies and legal documents are put in place to ensure that in the event of a partner or shareholders death, the remaining co-owners have a sum in place to buy out the family of the deceased.

The plan will have no cash in value at any time and will cease at the end of the term.  If premiums are not maintained, then cover will lapse.

Contact us to find out more.

Death In Service

Death in Service Life Insurance policies are life insurance policies that can be linked to a company pension scheme. An employee can be covered for up to four times their salary if they die while employed (hence ‘Death in Service Insurance’) and their nominated person receive the insured sum free of tax.

This benefit is popular with both companies due to their relatively low cost and members of staff who can feel secure that their families will be looked after if they die. It is probably the most cost-effective Life Assurance cover available.

Group Death in Service Insurance policies represents significant value for money compared to individual life assurance policies. Apart from the tax relief for the employer, underwriting and administration is usually simple.

How does Death in Service Insurance benefit the employer?

  • Attract and retain staff incentive

  • Tax-efficient – it is classed as a trading expense

  • It is approved, not a ‘benefit in kind’

  • There is a continuous entry for new members


How does death in service insurance help the employee?

  • Offers a lump sum benefit up to 4 times final earnings

  • Tax-free lump sum

  • Not a taxable ‘benefit in kind’

  • Simple set-up and administration

Contact us to find out more.

Group Income Protection

Group Income Protection cover provides financial support for employees if they are absent from work due to long term illness or injury.  Group Income Protection helps to alleviate the cost of long term absence to your business.

A Group Income Protection policy will pay a proportion of an employees salary in the event that they are off work due to long term sickness or injury. You can choose to either make the payments directly to an individual or use the policy to fund payment for a limited period and then provide your company with a lump sum to fund a leaving service benefit.

Some policies will provide rehabilitation services to help nurse absent employees back to health as soon as possible. This in turn helps to minimise the payments required on the policy.

Contact us to find out more.

Create Financial Management
Address: York House, Stephensons Way,
Wyvern Business Park, Derby, DE21 6LY
Phone: 01332 548 100

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