Pensions – definitions – National pension savings scheme (NPSS)

In 2012 the UK government will introduce a new system of pensions savings accounts called ‘personal accounts’ into which all UK employees will automatically be enrolled unless they are already members of an occupational pension scheme which has contribution rates above those of the new NPSS. The legislation was introduced as part of the Pensions Act 2007.†

Under the NPSS employers will have to contribute 3%, employees will pay in 4%of their salary and 1% tax relief will also be given.

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