Designing a Company Pension SchemeWritten on April 30, 2015 by Kirk Rice LLP
Financial Services QuestionsThe Question:
How long do you need and how much will you charge to set up Workplace Pension Scheme?
Kirk Rice LLP answers:
By the end of 2015 about 90,000 employers will have set up workplace pensions for their employees. In 2016 the number to do the same is a whopping 512,000*. Do not underestimate the implications for your business, no matter how far off your staging date is.
In our experience, this means starting the consultation with advisers or doing the work yourself at least 9 months before your staging date. Best practice ensures your scheme is selected and your internal procedures are changed at least 3 months before your staging date. There are more than a dozen pension scheme providers with substantial differences in their service and products. One may suit your workforce better than all the others, whereas in some cases two schemes may be the best way to deal with the diverse needs of different employee groups. You may already pay into individual employee’s personal pensions and you’ll need to be careful about how you deal with these. It is unlikely such existing arrangements will allow you to comply with the law. Some employees may indicate they will not want to join or pay anything into the scheme, yet an employer must enrol them into a scheme and do everything possible to encourage them to stay. You may have members in a Stakeholder Pension Scheme and this will need to be assessed to see if it meets the new law.
The law also places the responsibility to choose a suitable scheme with the employer. You’ll need to keep records about how you go about this duty and what factors led you to your decision.
If the staging date is at a busy time for your business, why not choose to start a scheme before the staging date if it better meets your business needs.
You can complete the process yourself and The Pensions Regulator has detailed guidance on their website, www.thepensionsregulator.gov.uk. An adviser can work through all of the issues for an employer who has insufficient resources, experience or knowledge in their firm. The benefit of an experienced adviser is that they will have been through the process before, will continue to monitor the scheme providers, have access to research and will monitor the legislation for you.
The fees for an adviser are going to vary according to the type of business, payroll and existing pension arrangements, number, ages and income of employees. Most advisers offer an initial meeting to discuss the needs of your business and will quote the fees accordingly.
If you would like more advice regarding this issue or any other financial services matter, please contact us.
If you would like to receive Kirk Rice’s Financial Services Questions regularly by email, simply email info@kirkrice.co.uk stating Financial Services Questions in the subject heading and we will add you to our distribution list.
Please note: answers are given for general guidance only and specific advice should be taken before acting on any of the suggestions made.
A Pension is a long term investment and the fund value may fluctuate and can go down. Your eventual income may depend upon the size of the fund at retirement, future interest rates and tax legislation.
Recent Posts
-
Career Story – Rebecca EvansWritten on October 9, 2026 by Kirk Rice LLP
-
VAT Compliance: What Every SME Should KnowWritten on October 7, 2026 by Jonathan Swarbrick
-
6 Things to Know About Tax on Extra Income: Second Jobs, Freelance Work, & MoreWritten on October 5, 2026 by Jane Page
-
Business Valuation – Where Do I Start?Written on October 2, 2026 by Kirk Rice LLP
-
Payroll – Should You Outsource?Written on October 1, 2026 by Kirk Rice LLP
