Auto Enrolment vs PRSA

My friend currently has a pension where a certain amount of her salary is paid in to. The company don’t make any contribution. It was organised and set up by her. Am I correct in saying that AE is not available in this case.

Should she stop the company making the payments and make them herself?

In this case would the company need to make set up AE for her and make the 1.5% contribution and the state make the same? She would add 1.5% also.

What are the charge rates for AE? Should she then keep the PRSA or just make all payments via AE?

She had the wisdom/foresight to look after herself.

IMHO, she should not do anyting until the employers hand is forced on AE, a PRSA Scheme or an Occupational Pension Scheme. Even at that, it might still be in her interest to wait on making any changes until AE is up and running for a while.

There are still a lot of questions that need to be answered on AE and employers are not fully engaged with the reality yet.

There's a handy Employer Guide To Auto Enrollment here but just bear in mind it was written by industry for industry.


Gerard

www.prsa.ie

GSheehy said:

She had the wisdom/foresight to look after herself.

IMHO, she should not do anyting until the employers hand is forced on AE, a PRSA Scheme or an Occupational Pension Scheme. Even at that, it might still be in her interest to wait on making any changes until AE is up and running for a while.

There are still a lot of questions that need to be answered on AE and employers are not fully engaged with the reality yet.

There's a handy Employer Guide To Auto Enrollment here but just bear in mind it was written by industry for industry.


Gerard

www.prsa.ie

Click to expand...

Thank you for your response.

The employer is small and most (not my friend) employees make close to min. wage with no benefits. It seems likely they would go down the AE route?

From the document you linked, "All employees between the ages of 23 and 60 and earning 20k or more will have to be included in the WE scheme unless they are already in a pension scheme or making a pension contribution through payroll."

(slightly paraphrasing my c&p isn't working)

A financial advisor noted that by continuing to have the employer make deductions on her behalf (but no contribution) that the employer was off the hook for the 1.5%.

So by doing it herself and claiming tax back she would get an extra 1.5% a year. Not to be passed up. I understand she would need to match?

Could it really be the case that its a get out for employers who don't contribute?!