Nannies entitled to pensions from 2011?

[Strix]

I heard from another mum that nannies will entitled to a pension in thenear future (think it was 2011?). Is this true? Anyone know anything about it?

And, if it is true, does this mean that all employees are entitled to private pensions? Do employers need to contribute to it, or just do the admin in the same we are responsible for removing money from his/her gross pay to pay the tax?

really?

You could maybe check with HMRC

my company doesn't operate a private pension scheme - never has done

Or does it mean as an employer you have to provide a scheme but you wouldn't necessarily have to contribute?

gah - will speak to my payroll company (as i am a new nanny employer)

Also not heard that and the almighty google can give me no reference so payroll companies probably haven't updated their websites.

here?

or here?

Not found any 'official' sites though.

I can't find the Pensions Act 2008 it refers to which says all employees will be auto-enrolled from 2012.

From Frakk's link: "However, there have been suggestions that if the Conservative Party wins the next year's election compulsory pension provision will not be implemented. "

I think this is a terrible idea to be honest. If I have to contribute 3% to nanny's pension, that means I will have to adjust her salary down 3%.

But I am hopeful that that coalition will see the light and not implement this.

And, furthermore, I think it will be one more reason for parents to offer cash in hand, not doing anyone (the goverment or nannies) any favours.

I'm a pension ignoramus. Does it come out of the gross wage or is it on top of it?

I just pay into my private one and get tax relief but that came out of my net salary so I have no idea of exact figures.

Here is a fairly current article: www.thisismoney.co.uk/pensions/article.html?in_article_id=501376&in_page_id=6

(thanks to Frakk I am now googling the correct year and getting some results)

If this article is right, it looks like I have until 2014 since I only have 1 employee. And i read somewhere else that the employee would have to earn over some £5000 per year. So this begs the question of whether au pairs who come over for 12 months and who make more than £100 per week will be entitled to a pension. Sounds like a beaurocratic mess if you ask me!

I think they would. As far as I (or anyone else in the round the houses discussions we have) au pairs are employees (as far as the letter of the law is concerned) because they aren't anything else, so they have all the same right as any other employee, which would include pension contributions. That's gonna be a PITA!

Presumably nannies will be done through the NEST scheme? Or do you reckon payroll companies will set up their own?

quickly spots niche in market, grabs it

What is NEST? (Strix declares pension ignorance)

It was on your link Apparently it's the National Employers Savings Trust which is the state led alternative to a private scheme.

I have no idea what that means though!

You're completely right that this will mean more people under the table or underdeclaring.

My pension comes out of my gross wage. So, another reason not to agree NET with anyone.

This is the official site of the organisation tasked with delivering the new pensions...

www.padeliveryauthority.org.uk/

I already pay my nanny a pension. I figure if I get one then so should she.

Thanks, Harriet.

adds ammo to the gross wage argument

If I understand it corrently, and feel free to tell me I don't - the employee will have X amount deducted from their gross wage and the employer will have to match the contribution?

Giving my nanny a pension is simply not something I can afford. And I expect I am not alone.

tax tax tax... where does it end?!

Can we get Dave and Nick on here? I want to talk!

strix, there are rumours, that the new governmetn is going to axe the new proposed 'personal accounts' system.

Oh God bless them... if they do.

IIRC you employ mostly non-British nannies who probably won't care about a pension though, right?

Just have vague memories of you mentioning a Canadian and a Polish girl and recruiting from overseas so not liking the OFSTED fiddle-faddle.

The idea has been hovering around for a while now, at some point it will be likely that everyone will have to have their own personal pension fund into which employers will contribute; larger employers already have own schemes, small employers will use something like the NEST scheme. VERY unlikely that companies like nannytax will set up their own - but they will almost certainly take on the extraction of money to pass on.

I reckon there is an 80% likelihood that this will happen in the next 3 years, but that initially the govt will try to get small business acceptance by matching it against employers NI for a transition period (before phasing the matching away of course).

The big pension problem won't go away and of coourse the only people who can fund it will be employers. Which unfortunately means us. Con-Dems likely to be slightly nicer about it to employers than Labour would have been.

frakkit - it will probably apply to anyone with an NI number, overseas or not (which of course makes it even more of a mess)

But my point was overseas people would probably opt out (which if I'm reading it correctly is still an option?) so Strix may not in fact end up having to make the additional pension contributions.

Strix is going to get two au pairs, neither of whom will make enough money to qualify. Do you think they will mind sharing a double bed? Or should I get bunk beds for their room? Do you think they could share one bus pass and eat half as much?

I'm joking, obviously.

Am holding out hope for Dave and Nick to do the right thing.

Most of the information here is correct, the recently published guidance is here - to summarise:

For employers with fewer than 50 employees this doesn't come in until at least August 2014, and will be phased in so employers contribute 1% in the first year, 2% in the second year and 3% in the third year onwards.

It only applies on earnings above the NI threshold currently £5,044.

Only employees over the age of 22 will have to be automatically enrolled.

All of this, and a quango called the Personal Accounts Delivery Authority which is setting up the National Employment Savings Trust (NEST) were set up by the last government. Whilst everyone agrees that saving for retirement is a big issue, I suspect that Conservative and Liberal politians, for a range of reasons, may want to do things somewhat differently.

I wonder how long it takes to abolish a quango established by primary legislation?

Frakkin, there isn't a gap in the market, there are many pension scheme providers around - Google stakeholder pension.

I meant a gap administering it for nannies - like a payroll company but for pensions. For employers who can't be bothered to do their research.

I'm crap with figures anyway so definitely not the person to do it!

Will probably just be absorbed by the existing companies. As an employer, I certainly wouldn't hire one payroll company for taxes and another for another pensions. How would I get all the information onto one payslip.

But, I do think it all may change with out lovely coalition. Either way I'm safe until 2014 by which time I probably will have only an au apair. So, I think I will scrape by and avoid the whole thing.