Core Services

Wentworth Employee Benefits offer full advice and administration on:


Staff Pension Schemes

If you already have formal defined benefit (final salary) or defined contribution (money purchase) pension schemes in place, it can sometimes be helpful to have an independent review to ensure that the current terms are as beneficial as possible and that both the employer and members are receiving value for money.

Wentworth Employee Benefits can look at current arrangements and give a totally independent view of whether they are in the best interests of the company and its employees. Where any remedial action is required, we are able to make recommendations and, if required, to implement the changes.

All companies with more than four employees are required to nominate a Stakeholder pension plan for their employees where they do not have a suitable scheme in place although the take-up of these has been relatively low.

Nevertheless, many employers are concerned that retention of high calibre staff is becoming difficult and that providing a first class pension scheme can be an excellent way of ensuring that employees recognise the benefit of staying.

Wentworth Employee Benefits can advise on alternative strategies for establishing employee pension schemes that offer maximum flexibility for employers and employees, enabling each member to select an investment strategy that best suits his or her attitude towards risk and timescale for requiring benefits. We often work with employers changing from final salary to defined contribution schemes and we run workshops, draft announcement letters and ensure employers and employees fully understand the changes. [Top]


Self-invested Pensions

Many directors and executives find that self-invested pensions offer them far greater flexibility, in terms of contributions, investment strategies and how eventual benefits are taken, than conventional ‘insured’ pension schemes.

There are two forms of self-invested (or member directed) pension schemes; Self Invested Personal Pensions (SIPPs) which are also available in group versions, and Small Self Administered Schemes (SSASs).

There are some practical differences, but these are relatively technical and we will be able to advise you on which is most suitable to meet your needs.

Overall, self-invested pensions allow members to invest in a wide range of assets, including:

  • Shares;
  • Share-based collective investments;
  • Bonds;
  • Cash; and
  • Commercial Property.

Many other assets that can be expected to grow in value are permitted including loans to third parties. In addition, self-invested pensions can borrow up to half their value in order to finance acquisitions of permitted assets.

Wentworth Employee Benefits can advise on set up and administer suitable self-invested pension schemes, including explaining the relative merits of alternative contribution and investment strategies. [Top]

 

National Employement Savings Trust

Because as a nation we do not save enough for our retirement - with more people living longer when they do retire and a comparatively shrinking working population left to pay for state pensions - the government has decided to introduce a compulsory form of pension planning, the National Employment Savings Trusts, or NESTs for short.

NESTs will be mandatory for all employees earning between about £5,000 and £33,000 a year, unless they opt out of the system every three years, and will involve an employer's contribution of 3%, a personal contribution of 4% and a government contribution of 1%. The only exception will be where there is already an employer pension scheme in place that satisfies set criteria (please ask for details).

NESTs start in October 2012, but will not apply in full to everyone for several years as their introduction is being phased in, starting with the largest employers. They will be managed by an independent company on behalf of the government and will carry a number of investment options.

Those wishing to avoid becoming involved - either as individuals or employers - should seek professional advice as soon as possible. [Top]

 

Pension Regulations

The pension market changed radically in April 2006, making it possible for most people to save far more each year than was previously possible. Since the 2009 budget, matters have become radically more complicated for those with incomes in of £130,000 a year or more and we can advise individually on this.

In generally, however, individuals can now invest their entire income each year, into a pension scheme, subject to an overall annual limit set at £255,000 for 2010/11 (and until at least 2015/16). There is also a lifetime fund limit initially set at £1.8 million for 2010/11 (also until at least 2015/16). Everyone will be able to take a maximum of 25% of their pension fund as a tax-free ‘Pension Commencement Lump Sum'.

Anyone who applied for Enhanced Protection against the impact of taxation on very large pension funds (which had to be done before April 2009) must take advice before making any further pension contributions, or having them made on their behalf, as they will lose the benefit of their protection. This would apply even if an employer contribution were to be made on their behalf into the new National Employment Savings Trusts (NESTs) due to be launched in October 2012.

Wentworth Employee Benefits can advise on the impact that ever-changing pension regulations will have on individuals' retirement plans, particularly in respect of tax-free cash entitlement and ‘protection' of the fund from taxation, where necessary. [Top]

 

Life Cover

Protecting members’ families against loss of potential future pension benefits due to the death of a scheme member is something that is not always given due consideration. Many pensions today automatically provide some level of benefit on death before retirement, but this can be little more than a return of the fund which, in the early years, is unlikely to be adequate to provide an adequate dependant's pension.

Wentworth Employee Benefits advises on and arranges suitable life assurance that can provide a lump sum to generate an income for a surviving family, on the death of a member.

This can be arranged on an individual or group basis, as required. Company-sponsored life cover is appreciated by staff and cost-effective for the employer. [Top]


Income Protection

Long-term incapacity can also represent a major financial threat to scheme members; not only preventing them from earning a living, but also substantially reducing their future pension prospects.

Wentworth Employee Benefits advises on and arranges suitable income protection that can generate a lump sum or, more usually, an income that will run from soon after incapacity occurs until a pre-selected age is reached.

This can be arranged on an individual or group basis, as required. [Top]


Advice for Individual Scheme Members

Wentworth Employee Benefits is pleased to advise individual scheme members on their pension benefits including investment strategies and the treatment of previous arrangements.

We are also well placed to advise individual members on their options at retirement, including use of the ‘open market option' to purchase the best annuity on the market as well as the unsecured pension option (formerly know as drawdown or pension fund withdrawal) and the alternatively secured pension, for those over age 75. We can also advise on the new temporary annuity products that offer a ‘third-way' of taking retirement income. [Top]


Please note that these comments are based on our understanding of current legislation and tax practice as at 1st May 2010 which are subject to change without notice.

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