UK. How to prepare for the Pension Schemes Act
New pension regulations will come into force this year. What will they mean for trustees, employers and savers?
Further provisions of the Pension Schemes Act 2021 are set to come into force in 2022, aimed at protecting the retirement funds of savers in defined benefit (DB) pension schemes. What will this mean for trustees, employers and savers, and how can they prepare?
The new notifiable events regime is the most pressing agenda item for scheme trustees and employers in their role as sponsor of DB pension schemes.
A DB scheme offers employees a retirement fund based on the number of years they have been a member of their employer’s pension scheme and their final or average salary. A defined contribution (DC) scheme offers savers a retirement fund based on the accrual of the contributions they make during their employment, together with contributions made by their employer.
From 6 April 2022, the regime requires sponsoring employers of DB schemes to notify The Pensions Regulator (TPR) and scheme trustees when a ‘decision in principle’ is made about certain corporate transactions: for example, the sale of a material proportion of its business or assets.
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