An employer's responsibilities will vary depending on whether they run their own pension scheme and the type of pension scheme they offer. The key duties of an employer in relation to pension schemes and tax are outlined below.
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You don't have to set up and run a pension for your employees, but there are rules about giving your employees access to a pension scheme. One of your roles will be to choose the type of pension scheme that you offer to your employees.
If you do have your own occupational pension scheme you must make sure that any pension scheme assets are kept separate from your business assets.
If you have five or more employees you must give them access to a stakeholder pension scheme unless you already offer a pension scheme. As an employer you don't currently have to contribute to your employees' stakeholder pension. However you'll have to make contributions when the automatic enrolment rules come into effect for your business. More in the section below.
If you run your own pension scheme you may also be the trustee or scheme administrator of your pension scheme. These roles have separate specific duties under pension scheme law.
From October 2012 you must:
The dates for automatic enrolment depend on the number of employees you have. Larger employers will go first, with small and medium sized employers following after that.
If you take pension contributions from employees' pay they must reach the pension scheme within 19 days from the end of the calendar month in which they were deducted. For example, if the contribution was deducted in July the scheme administrator must receive it by 19 August.
You must pay your contributions on time in line with the contributions schedule agreed with the pension scheme. If you don't pay on time The Pensions Regulator may take action against you.
You'll need to provide information to the scheme administrator, trustees or pension provider so that they can run the scheme correctly. For example, for a defined benefits scheme the scheme administrator, trustee and pension payer will need the members' pay details in order to work out how much pension an employee can get in a defined benefit scheme.
Pension scheme administrators may need to give members an annual statement of their pension savings (pension inputs) to enable the member to work out if they'll be liable to the annual allowance charge. If your pension scheme is a defined benefit or cash balance scheme the scheme administrator will need information from you so that they can issue the pension saving statements.
If you have any problems or concerns about the running of the pension scheme you should tell The Pensions Regulator.