PensionPlusSAUL Presentation
By Jenny Casey & Ben Hancock
Pensions Payroll
PensionPlus
What is PensionPlus? Why is LSE introducing PensionPlus? Who else has introduced it? How does PensionPlus work? Pay Advice changes What are the benefits? Is PensionPlus for me? Participation Where can I find out more details? Questions?
What is PensionPlus?
At present, your pension contributions are tax efficient.
Under PensionPlus the total employee and employer contributions will be paid to SAUL by the School.
NIC Savings for the employee and SchoolAt present AVCs will not be included.
Why is LSE introducing PensionPlus?
SAUL have changed their rules.The LSE believes that this will be
advantageous to employees to maximise their take home pay by a reduction in their National Insurance contributions.
The School will also benefit from lower National Insurance costs.
Consultants
PricewaterhouseCoopers (PWC).Why PWCPWC will seek HMRC approval which will
enable us to go ahead with the scheme in July 2009.
Other Institutions who have implemented their own versions of PensionPlus:
OxfordUSS LtdUniversity of ExeterUniversity of SouthamptonUniversity of BirminghamImperial College LondonUniversity of London Senate House
How does PensionPlus work?
Your current employee pension deduction will be reduced to nil.
The School will then pay an increased payment to the Pension Company made up of your contribution along with the standard employer contribution.
Your total pay each month will be reduced by an amount equivalent to your original pension contribution.
Member
Employer Scheme
PAY
Mem
ber contribution
Employer contribution
Existing Arrangement
New Arrangement under PensionPlus
Member
Employer Scheme
Pays re
duced sa
lary
Member contribution
Employer contribution
Changes to your Pay Advice
Pre-PensionPlus (Current):
With PensionPlus:
What are the benefits?
Your take home pay will increase.
The School will make a saving.
Annual National Insurance Savings
Annual Salary Annual Employee NIC saving
£15,000 £84.60
£20,000 £112.80
£25,000 £141.00
£30,000 £169.20
£35,000 £179.40
£40,000 £225.60
Will PensionPlus reduce my pension benefits?
No Your full pensionable salary will be
unchanged.Retirement calculations will still use the full
pensionable salary.Death in service lump sum payments will
be calculated on the full pensionable salary.
When PensionPlus may not be advantageous to you
Members with 2 years or less pensionable service who wish to leave the scheme.
What happens if I cannot have a refund?
Your contributions can either:
a) be used to transfer to another scheme after leaving.
b) be used in the calculation of your pension at retirement age.
What if I do not wish to participate in PensionPlus?
You do not need to participate in PensionPlus as it is not compulsory, however the School initially intends to enter all SAUL members into Pensions Plus.
If you decide to opt out of PensionPlus then your current pension arrangements will continue as before.
Can I opt back into the scheme?
Yes you will be able to opt back into PensionPlus but only on the anniversary date of PensionPlus which will be 1 July on each year.
Where can I find out more details?
Information booklet.School website under HR or Pensions.Power Point Slides.
Questions?