Pensions – definitions – Personal accounts

In 2012 the UK government will introduce a new system of pensions savings accounts called ‘Personal Accounts’ which is a basic, inexpensive pension plan that employers can use, unless they wish to offer staff a different form of pension scheme that is no less favourable than Personal Accounts.
In 2012 a new Pension Act will come into play whereby all UK employees will automatically be enrolled into their employers’ pension scheme (regardless of type) unless they are already members. Under the Act 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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