Pension rules for charities
Find out when you will have to start making pension contributions for your charity's staff and how much you will have to pay.
Applies to England and Wales
New pension arrangements
Workplace pension rules changed in October 2012 and every employer, including charities, will have to act.
If your charity employs staff, you will need to enrol all your eligible workers into a pension scheme and make a contribution towards it. If you employ fewer than 50 staff, you can choose to do this between 1 August 2015 and 1 April 2017.
Eligible workers
Workers employed and paid by the charity for the work they do are eligible for pensions if they:
- earn more than the current minimum wage
- are aged between 22 and the state pension age
- work in the UK
‘Workers’ include contractors and agency staff, as well as people working under an apprenticeship. Volunteers and unpaid staff are not eligible.
Your contribution and what you have to do
As an employer you must contribute at least 3% of your workers’ earnings to a pension scheme, while they pay the rest. The total contribution must be a minimum of 8% of each worker’s earnings.
The Pensions Regulator will give every employer a staging date, when they will have to have the new arrangements in place. Charities with fewer than 50 staff can choose to move their staging date to between 1 August 2015 and 1 April 2017.
The main things you must do are:
- register with the Pensions Regulator
- provide a pension scheme
- enrol workers into the scheme and let them know
- pay your contributions
Existing pension schemes
If you already have a scheme in place, you will need to check that it:
- is a qualifying scheme
- meets the new requirements
Make sure you and the other trustees discuss and agree any changes that need to be made to your current pension scheme.
Many charity pension schemes will meet the new requirements and qualify. If your current scheme doesn’t qualify then you may be able to make some changes and qualify before your staging date.