Auto enrolment of workplace pensions commenced in October 2012, it started with the largest employers first and by February 2018 every employer in the UK will be affected.

As an employer, you’ll have new duties in relation to everyone working for you: who is aged between 16 and 74; who work in the UK; for whom you deduct income tax and National Insurance contributions from their wages.

The whole area of auto enrolment is a complicated one, determining who is an eligible worker or an entitled worker for instance needs constant monitoring.

However one area that can help with the burden of the new regime is Salary Sacrifice.

Benefits to the employee: Depending on how the sacrifice is established and the type of scheme involved, the employee typically achieves a higher contribution for the same level of net spend. This extra contribution is arrived from avoiding personal National Insurance, a small gain in tax-relief and sometimes an additional but discretionary extra contribution from the employer’s National Insurance saving as well.

Benefits to the employer: The employer avoids National Insurance on the amount sacrificed by the employee and many employers give some of this saving back to boost the member’s contribution.

The balance of any saving can be used by the employer for other business costs, although the obvious spend at this time would be to help to meet some of the costs associated with Auto enrolment. As well as the cost benefit, the employer may also gain from improved employee relations.

For further information and advice regarding the area of Auto enrolment, contact Kymin Financial Planners at www.kymin.co.uk