At Prosperity Pension Services, we make it straightforward for employers to select and set up the right pension offering while staying compliant with the new law. Our expert guidance helps you understand the available options so you can focus on what matters most: your business and your team. This guide summarises the key facts to consider.

1. Employer Obligations

Employers must establish and maintain pension plans for their employees. This includes registering the pension plan and complying with rules for contributions. Employers are required to participate in or offer a pension plan based on the size of their workforce. Deadlines range from 2025 to 2027 depending on employer size (medium, small, or micro employers).

Minimum Contribution: 2% employer 2% employee.

Registration of Pension Plan

2. Contributions

If acting on the statutory minimum, both employees and employers must contribute to the pension plan. The minimum required is 2% of the employee’s basic gross annual earnings from both parties (employer and employee).

Employers can set higher %s if desired. Additional voluntary contributions from employees are allowed.

3. Eligibility

Employees aged 15+ who earn at least £10,000 annually and have completed 12 months of employment must be enrolled in the pension plan. Employees can choose to opt out but must be offered the opportunity to re-enrol at least every three years.

4. Pension Plan Options

Employers have to select from a choice of different pension options that all are compliant under the Act. The main types of pension schemes allowed are shown below:

5. Administration and Record-Keeping

Employers must provide necessary information and submit documentation on the GFSC One Drive portal for registration.

Pension administrators must provide employees with clear information about the plan and benefits.

6. Penalties for Non-compliance

Failing to adhere to pension plan requirements are an offence and can lead to serious consequences and penalties:

Fines

Monetary penalties for failure to register employees or contribute as required or commit an offence under this Act.

Back Payments with Interest

Unpaid contributions must be reimbursed, often with added interest to cover delayed payments.

7. Benefits of Prosperity Pension Plans

Prosperity helps simplify the process of offering a pension plan. Our expert team is dedicated to saving you time and effort in selecting and implementing the most suitable pension plan for your workplace. Partnering with us is the ideal choice, here’s how Prosperity can benefit you and your team:

Hassle-free Process

We manage the entire pension setup and administration, saving you time and reducing stress.

Expert Management

Leave pensions to the experts, allowing you to focus on core business priorities.

Regulatory Compliance

Working with a regulated professional pension provider ensures adherence to pension regulations. Make sure your business ticks all the right boxes.

Build Employee Loyalty

Shows employees you care about their future, increasing their loyalty and connection to your company.

Happy Retirement

Employees feel secure and satisfied, knowing their financial future is in safe hands.

Tax Savings

Take advantage of potential tax benefits associated with a well-managed pension plan.