Auto-enrolment Pension Schemes

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10 Oct 2012

The Association of British Insurers have contacted me regarding the Government's new auto-enrolment scheme which came into force last week.

People in the UK will now begin to be automatically enrolled into pension schemes for the first time. Initially, auto-enrolment will only affect large companies and those who work for them but within the next few years it will have an impact on millions of people and all businesses.

Employers and employees will both pay into the scheme, with employees also getting some money back from the Government through pension tax relief which means that they will not pay tax on the money they pay into their pension. Small and medium size employers will begin auto-enrolling in April 2014.

Individual employees can opt out of auto-enrolment, which means they will not be in the pension scheme - but it also means they will not get the money from the employer or tax relief from the Government. If the employee opts out, they will be automatically re-enrolled three years later. They may then decide to opt out again.

If any local residents or small businesses have any questions about this matter please e-mail me at