Company pensions – employees

Helping you take control of your future

If your employer has set-up a company pension plan with Standard Life, you’ll want to make sure you get the most from it. Depending on how the plan has been set up, you may have some say in how your savings are invested. And you may be able to decide how much you contribute.

Standard Life has developed a special website for employees in one of our company pension schemes. Employeezone offers a range of facilities, including:

  • Checking your plan details
  • Getting an up-to-date value for your plan
  • Changing your payment details
  • Finding out more about pensions and savings

You’ll also find some contact information if you need to get in touch with us.

Find out more with the Employeezone online tutorial.

Benefits of a pension

When you stop work you’ll no longer receive a salary.. If you only receive the basic state pension when you retire, it may not be enough to live on. It is also important to note that the State Pension age is increasing, so you will have to wait longer to receive your State Pension.

You’ll need to make some plans to help replace your salary. A pension plan is one way of doing this.

Why save with a pension?

A company pension offers you a tax efficient way to save. You make payments while you’re working. When you retire, any money held in your pension fund can be used to provide you with an income, or a tax-free lump sum and a smaller income, for the rest of your life.

Will the Basic State Pension be enough?

In the 2014-15 tax year, it’s just £113.10 a week for a single person. With Pension Credit, you would be guaranteed a minimum weekly income, including your Basic State Pension, of £148.35 a week for a single person.

However, if you also have a company pension, you could have a higher income in retirement.

How pensions work

Investing in a pension plan is very simple:

  • Making payments – you make regular payments during your working life and benefit from valuable tax breaks. Your employer may also pay in.
  • Your payments are invested – in one or more of a range of professionally managed funds. Charges and investment performance may affect the value of the funds you're invested in.
  • When you retire – any money held in your pension fund is normally used to provide an income. Your pension income will be taxed as earned income. You can take part of your pension fund as a tax-free lump sum which means you will receive a smaller pension.

Payments to a pension plan are normally flexible. For example, subject to the rules of the scheme, you can:

  • Decide how much to pay in
  • Make additional single payments when you have spare money
  • Decide when you want to retire
  • Transfer in existing pension pots from other jobs

Pension tax benefits

When you join your company pension scheme both you and your employer are contributing towards your pension.

There are 3 possible ways you can make payments to the scheme and get tax benefits.  Your employer will let you know which method your scheme uses.

Option 1 - Your company uses salary exchange.
This means that you exchange part of your salary for a payment from your employer to the pension scheme.  You don't get tax relief on that payment but you do save tax on the salary you have exchanged.

Your company doesn't use salary exchange. Option 2 or Option 3 are applicable.

Option 2 - Your payments are deducted from your pay before tax.
Payments to your pension scheme are taken from your salary before tax. This will happen automatically - you don’t need to do anything.

Option 3 -  Your payments are deducted from your pay after tax.
The government adds 20% tax relief on your pension payments, topping up your savings for you. The good news is that you don't have to do anything - we'll claim the 20% tax relief for you and automatically add it to your plan. That's definitely something worth having. 

How your savings are boosted by tax benefits
You invest The government pays Your pension gets
£100 £25 £125
£200 £50 £250
£300 £75 £375

 

If you're a higher or additional rate taxpayer, you may qualify for extra tax relief. If this is the case, we'll claim the first 20% tax relief for you and add it to your plan. You'll need to claim the extra relief by contacting HMRC.

Tax rules and legislation may change. The value of tax relief may change and will depend on your financial circumstances. The information we have given is based on our understanding of law and current HM Revenue & Customs practice as at April 2014.

How your employer helps

Your employer can help you to save for your retirement.

This could be by collecting your payments from your salary and forwarding them to Standard Life. Your employer may also make payments to your pension plan which may boost the size of your pension fund when you retire.

Speak to your employer for more information about how they will help with your pension planning.

Your employer's payment may be conditional on choosing from a list of funds specially selected by your employer and their adviser.

Key decisions

If you decide to join a pension plan, there are a number of important decisions you’ll need to make. These include how much you should pay into the pension, where your payments are invested and what you can do with any existing pension plans that you have. Remember it is your pension plan, so it’s important that you regularly check that you are on target.

How much should I save?

You should consider putting aside as much as you can reasonably afford without overstretching yourself – the long term rewards can be well worth it.

Many people would rather not think about starting a pension. But every day you put it off could make a difference to your income when you eventually retire. It’s never too late to do something about your pension – but the longer you delay, the more it’s likely to cost you.

If you’re unsure about how much you should pay into your pension, you should speak to a financial adviser. There may be a cost associated with obtaining advice. 

Which funds can I invest in?

In some cases, the scheme trustee or employer will make the investment choice on behalf of all members or will select a shortlist of funds for them to choose from. Alternatively, members may have access to a wider range of funds. Your employer can tell you what investment options you have.

Where the scheme trustee or employer has given you access to either a shortlist or wider range of funds, you can choose where your payments are invested, although you can't invest in more than 12 of our funds at any one time. You may also be limited to investing in a maximum of 20 different funds during the lifetime of your pension.

How you choose your fund(s) will depend on a number of factors. These include:

  • How long until you retire – if your retirement is a long way off, you may be prepared to invest in funds with a higher level of risk which have the potential for higher long-term returns. But if you're closer to retirement, you may prefer to invest in funds which aim to provide lower but more stable returns
  • How much active involvement you want – are you likely to switch funds regularly or stick with the same one
  • Your attitude to risk – if you're younger, you may be happy to accept more risk than someone who's approaching retirement. You should also consider how much risk you're able to take, bearing in mind your other financial commitments and personal circumstances

As with any investment the value of your fund can go up or down and may be worth less than what was paid in.

Any charges and additional expenses are not guaranteed. They are regularly reviewed and may be changed in line with developments in the relevant markets.

If you’re unsure about where your payments should be invested, you should speak to a financial adviser. There may be a cost associated with obtaining advice.

Your existing pension plans

The options you have for your existing pension plan(s) will vary depending on the type of plan(s) you have.

Typically, you can keep them going, although if a pension plan is set up through a previous employer, you may not be able to continue making payments into it. If this is the case, the plan is made ‘paid up’. This means it remains invested and will incur charges as before, although you are not continuing to make payments into it.

Alternatively, you can transfer your previous pension(s) into your present employer's pension plan. There may be restrictions on when you can do this and on the minimum amount of any such transfer. You may incur a charge. There is no guarantee that what you'll get back from the Standard Life pension plan will be higher. You may get back less.

When considering what to do with your existing pension arrangements, it is important to seek advice from a financial adviser. There may be a cost associated with obtaining advice.

Review your existing pension

It’s important to take time now and then to review your pension, and think about whether you need to pay more into it. Ask yourself:

  • When you last took a look at your existing pension
  • Are you sure your pension is on course to provide the retirement you want?
  • Are your payments invested in the fund(s) that meet your investment needs and views?

If you want your pension to support you as you expect in later life, you need to keep a keen eye on it now and give it a boost if necessary. That could mean topping up the amount you're paying in, or simply checking that you're happy with the choice of funds your money is invested in.

Your investment options

There are different options open to you if you want to save more for your retirement. Subject to the rules of the scheme, you can:

  • Increase the regular payment you make to your pension
  • Make additional one-off payments to top up your pension

Depending on your current pension arrangements, you may not be able to change the payments you make to your company pension. Some types of pension require you to set up a separate contract for any additional payments you wish to make.

Reducing your payments may result in a lower plan value and will reduce your future pension.

Speak to a financial adviser for more information about the limits that apply to your plan. There may be a cost associated with obtaining advice

How much more should I pay?

The main question to ask yourself is "Am I paying enough into my pension to meet my retirement goals?"

You should consider putting aside as much as you can reasonably afford without overstretching yourself: the long term rewards can be well worth it.

Remember that every day you put it off could make a difference to your income when you eventually retire. It’s never too late to do something about your pension – but the longer you delay, the more it’s likely to cost you.

If you’re unsure about how much you should pay into your pension, you should seek financial advice. There may be a cost associated with obtaining advice

How do I pay more?

How you change your payments depends on how they are sent to Standard Life:

  • If your employer deducts your payments automatically from your salary, you will need to speak to them
  • If you make payments directly to Standard Life, for example by Direct Debit, you can contact Standard Life by telephone

The number to call depends on the type of plan you have:

Group Personal Pensions 0800 634 7479
Stakeholder Pensions 0845 60 60 082
Group Plan 0800 634 7480
Group Additional Voluntary Contributions Plan 0800 634 7480
Group Self Invested Personal Pension 0845 60 60 057
Group Flexible Retirement Plan 0845 60 60 057
Retirement Account Plan 0800 634 7480
Trustee Buy-Out Plan 0800 634 7480

 

Calls may be monitored and/or recorded to protect both you and us and help with our training. Call charges will vary.

If you’re unsure about how much to pay into your pension, you should seek financial advice. There may be a cost associated with obtaining advice.

Am I invested in the right funds?

In some cases, the scheme trustee or employer will make the investment choice on behalf of all members or will select a shortlist of funds for them to choose from. Alternatively, members may have access to a wider range of funds. Your employer can tell you what investment options you have.

Where the scheme trustee or employer has given you access to either a shortlist or wider range of funds, you can choose where your payments are invested, although you can't invest in more than 12 of our funds at any one time. You may also be limited to investing in a maximum of 20 different funds during the lifetime of your pension.

It is important to regularly review the funds you’re invested in, especially as you approach retirement.

  • How long until you retire – if your retirement is a long way off, you may be prepared to invest in funds with a higher level of risk which have the potential for higher long-term returns. But if you're closer to retirement, you may prefer to invest in funds which aim to provide lower but more stable returns
  • How much active involvement you want – are you likely to switch funds regularly or stick with the same one
  • Your attitude to risk – if you're younger, you may be happy to accept more risk than someone who's approaching retirement. You should also consider how much risk you're able to take, bearing in mind your other financial commitments and personal circumstances

As with any investment the value of your fund can go up or down and may be worth less than what was paid in

Any charges and additional expenses are not guaranteed. They are regularly reviewed and may be changed in line with developments in the relevant markets.

If you’re unsure about where your payments should be invested, you should speak to a financial adviser. There may be a cost associated with obtaining advice

Changing your investment funds

There are two ways to change the funds you’re invested in.

Online

Log in to employeezone and change your funds.

If you’ve not registered for employeezone yet, you can sign up online.

You'll need your User ID and password, which you should have received as part of your pension plan joining pack.

By telephone

You can normally change your investment choice over the telephone. The number to call depends on the type of plan you have.

Group Personal Pensions 0800 634 7479
Stakeholder Pensions 0845 60 60 082
Group Plan 0800 634 7480
Group Additional Voluntary Contributions Plan 0800 634 7480
Group Self Invested Personal Pension 0845 60 60 057
Group Flexible Retirement Plan 0845 60 60 057
Retirement Account Plan 0800 634 7480
Trustee Buy-Out Plan 0800 634 7480

 

Calls may be monitored and/or recorded to protect both you and us and help with our training. Call charges will vary.

If you’re unsure about how much to pay into your pension, you should seek financial advice. There may be a cost associated with obtaining advice.

Further information

Why Standard Life?

Over 4 million people in the UK trust us with their pensions and life insurance. So you’d be in good company.

Standard Life has been around for a long time – since 1825, in fact. These days Standard Life Group is responsible for the management of around £232 billion (as at 30th June 2013). With that kind of experience you can be sure that your financial future is in good hands.

The level of service we provide has been recognised as the best in our industry, earning us the award for Company of the Year at the Money Marketing Awards in 2009 and 2011 - just two of many awards we’ve won in recent years.  

We always make sure the service you get from us is:

  • Clear – when you take out a pension with us, we’ll explain your options in plain English, and be on hand with support when you need it
  • Flexible – if your circumstances change, your pension can too. Our products are flexible, so you can adjust payments and switch to another product with no hassle.
  • Convenient – online access to your pension lets you keep track of how it’s worth and change your details, when you want

How do I join my employer’s scheme?

All information you need will be in your joining pack. If you have not received this then please contact your HR team.

Read the Key Features Document carefully, as this gives you the facts in very clear terms. The pack contains information to help you make a balanced and informed decision, as well as explaining how you can join.

Remember to seek advice if you are unsure. There may be a cost associated with obtaining advice

How do I contact Standard Life?

If there's anything you’re not clear about, speak to your employer or a financial adviser.

Alternatively, you can call Standard Life. The number you should call depends on the type of plan you have.

Group Personal Pensions 0800 634 7479
Stakeholder Pensions 0845 60 60 082
Group Plan 0800 634 7480
Group Additional Voluntary Contributions Plan 0800 634 7480


Calls may be monitored and/or recorded to protect both you and us and help with our training. Call charges will vary.

If you’re unsure about how much to pay into your pension, you should seek financial advice. There may be a cost associated with obtaining advice.

Important information

Before you buy a pension, you need to be aware of the risks and commitment involved. Details are available in the Key Features Document, which you can find in your joining pack. This also explains the retirement options and tax treatment in greater detail and we recommend that you read this carefully.

Please note, tax relief may alter and its value depends on your financial circumstances. Tax and legislation are likely to change in the future. The information given here is based on our understanding of law and current HM Revenue & Customs practice.

Need some help? Call us on 0800 634 7479 (+44 131 245 0896)

Monday to Friday 09:00 - 17:00

  • Our call services and terms

Calls may be monitored and/or recorded to protect both you and us and help with our training. Call charges will vary.

Changes to company pensions

Changes to company pensions

Pension reform and auto-enrolment start taking place later in 2012. Find out more about the changes to company pensions and view our short video on pension reform.