Adjusting To Pension Bookkeeping Help

Royds Accountancy

Accountants in Eltham
43 Lovelace Green,
Eltham,London,
SE9 1LG
UK
Phone: 020 3488 0529

 

There are various ways to put money aside for your twilight years as there are many different types of the pension scheme. Any saving for retirement that is arranged by an employer is called a workplace pension, which can fall into some categories: occupational, works, company or work based, for example. Workplace pensions work by automatically deducting your pay by a small percentage which goes into the pension scheme for you to be paid an income when you retire. Often, an employer and the government add money into the pension plan too. Workplace pensions are designed to provide security later in life during retirement, which is why for the most part; money can’t be taken from the fund until the employee is at least 55.

Outsourcing your bookkeeping will also take a lot of pressure of the employer. Having a reliable bookkeeper in London will help businesses of all sizes to keep a more accurate record of costs and payroll, which is something that needs to be kept track of by any auto enrolment employer.

According to the government, many workers have been missing out on pension benefits because they failed to apply to join their employer’s scheme or they were not offered access to a workplace plan. It is because of this that the government decided to make automatic enrolment compulsory.

Automatic registration requires employers to automatically enroll any eligible jobholders into a workplace pension scheme. This system must meet certain requirements and companies will also have to provide a minimum employer contribution. All arrangements are entirely the company’s responsibility.

The scheme is being phased in, with larger companies having earlier ‘staging dates’ (the date it becomes effective for them) and smaller companies later ones. Staging dates for all businesses are being staggered over six years with more and more employers being included with each month. Eventually, it will extend to employers with just one worker.

The ‘earnings trigger’ or level of earnings to qualify an employee for automatic enrolment is £8,105 or higher a year. Other eligibility conditions include age; the employee must be aged from 22 to state pension age. People who do not earn the required amount to qualify for auto-enrolment can choose to opt into the scheme, but their employer is not obligated to make a contribution.

For all workplace pension plans, the minimum contribution level is 8% of all qualifying earnings, 3% of which the employer must pay as a minimum. The company can pay more, in which case the individual will make up the difference, and they will receive tax relief on all their contributions. This contribution level is being phased in with a gradual increase so as to help employers adjust to the costs.

auto enrolment help

For some companies, preparing for the new plans has meant a lot of work. Those without pension schemes had to create one, and many companies have chosen to keep existing schemes and set up a separate auto-enrolment pension in addition. Usually, staff will be able to move to the main system after a specified amount of time has passed.

Get the most out of your accountant by getting them to outsource your bookkeeping too. A bookkeeper is useful and can save you money in the long run if you are a small business that can’t afford to hire an in-house bookkeeping service.

For employees, there is the possibility of opting out of the plan; they will be allowed to leave it at any time. To get their contributions back, however, an employee has to leave the system within one month. Otherwise, contributions made from their wages and any made by their employer will stay in their pension pot. It is also noteworthy that employees will be auto-enrolled every three years and every time they change employers.

You can see where you stand with professional auto enrolment help with a London bookkeeper in Eltham.

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