What is a pension?
A pension is a tax-efficient way of saving for your retirement. Both yourself, and providing you meet the criteria, your employer will contribute.
Why have I been put into a pension scheme?
• All employers now have to put their workers into a pension scheme if they earn over £10,000 per year, are aged 22 or over and are under state pension age. This is the law because the government wants to get more people to have another income, in addition to the state pension when they retire.
What if I don’t want to join the scheme?
• If you don’t want to join the scheme, you need to ask to leave it, ‘opt out’. You can choose to opt out the scheme in the one-month period starting on the date you receive your enrolment letter or the date you were put in, whichever is the latest. You do this by completing the form available from our pension provider – The Corpad Master Trust. To request opt-out information you can contact the pension provider. However, no action will be taken until you are enrolled in the scheme.
What if I ask to leave the scheme but then change my mind in the future?
• You can ask to rejoin the scheme by contacting us in writing by sending a letter which has to be signed by you. Or if you send it electronically, it has to contain the phrase, ‘I confirm I personally submitted this notice to join a workplace pension scheme.’
• If you earn more than £116 a week (£503 a month) we will pay into the pension scheme as well.
• You can only re-join once in any 12-month period.
If I ask to leave the scheme, what happens after that?
• Anyone who asks to leave, or stops paying into, the scheme will be put back into it at a later date (usually every three years if they meet certain criteria). This is because your circumstances may have changed, and it may be the right time for you to start saving. We will contact you when this happens, and you can ask to leave the scheme.
If I want to stay in the scheme do I have to pay in?
• You will pay 3% of your earnings each pay period. This will be taken directly from your pay and may include tax relief from the government. We will also pay in 2% of your earnings each pay period. Therefore, the total amount put into your pension pot will be 5% of your earnings. (Changes April 2018 & April 2019 See MGC table)
Will this amount change?
• As the money you pay in is a percentage of your pay, the amounts will automatically go up or down if your earnings do. Also, we are going to increase the percentage being paid into your pension over the next few years in line with the government’s minimum standards. From 6 April 2018, you will pay 3% of your earnings each pay period and we will pay 2%. And then from 6 April 2019, you will pay 5% and we will pay 3%.
(Please see below for Mandatory Government Contributions)
What are the mandatory Government Contributions? Date: Employee Minimum Contributions Employer Minimum Contributions Minimum Total Contributions Up to 5 April 2018 1% 1% 2% 6 April 2018 - 5 April 2019 3% 2% 5% 6 April 2019 onwards 5% 3% 8%
Pensions Frequently Asked Questions – April 2018
I am holding a working visa which is valid for 2years only, I shall not have my retirement life in the UK. Is it still a must to enroll in the scheme?
• The employee would still be required to Auto Enrol, they would be able to claim the fund when they turn 55 even if they are not in the country, alternatively, they are still able to opt out if they wish.
Can I get my money back after I end up my work in the UK after 2years?
• You would only get their funds when they turn 55 or when they choose to retire.
If my salary is unstable, i.e. the 1st month I can meet the minimum salary, but the 2nd month I do not, and at the 3rd month I do again, will I still be charged for the 2nd months? • Once the employee has earnt over £192 in a week everything they earn over £116 each week will be subject to Pension contributions. If they earn less than £116 they will not pay pension contributions. They will always have £116 that is not pensionable.
How can I monitor my pension?
• The members can monitor their pension using the TAM portal. Once enrolled they will receive details on how to register for access to the portal.
Can I find out where my money is invested?
• The members automatically go into the default fund and the portal will allow them to see what this consists of, where the money is being invested and how it is performing. They do have an option to change the fund they are investing in and the options available are detailed in their joining pack. They just contact Corpad to advise if they wish to change the fund.
What happens to my pension if I leave employment with CPI Selection?
• As the pension scheme is specific to that particular employer then once the member leaves CPI they also leave the pension scheme. They can either leave the money where it is and have more than one pension pot at retirement or alternatively, they can arrange to transfer their existing pension fund to their new employer's auto-enrolment pension scheme.
My provider doesn’t offer the option I want. Don’t they have to?
• The pension reforms allow providers to offer new options. If your provider does not offer the option you want, you should be able to transfer your defined contribution pension to another provider at any age up to retirement.
• You may incur some costs for transferring, and individuals who have pensions with special valuable features may have to seek independent financial advice first.
• Your provider may develop and introduce the options that you want in the future.
Will claiming my pension affect my State Benefits or my State Pension?
• Your State Pension is based on your National Insurance contribution history and is separate from any private pensions you have.
• Any money in or taken from your pension pot may affect your entitlement to some benefits.
• It is your responsibility to tell the Department for Work and Pensions or your local council if you or your partner take any money from your pension pot.