Are your employees reclaiming their unclaimed pensions? What business owners should know

The amount of unclaimed pensions is a rising concern, as many individuals are not claiming the pensions they are entitled to.

Recent figures highlighted that unclaimed pensions amount to an astonishing £28,000 per person.

As a business owner, it is imperative to help your employees in securing what belongs to them.

The Pension Tracing Service has indicated that the total amount in unclaimed pensions extends to millions of pounds, a sum that could substantially strengthen your employees’ financial stability during retirement.

Empowering your team with knowledge

Initiate a campaign to enlighten your team regarding unclaimed pensions and the procedures it takes to trace them.

Encourage proactive steps in discovering any unclaimed pensions they might have.

Guidance in pension tracing

Support your team in navigating pension tracing by promoting the utilisation of the Pension Tracing Service, a complimentary free facility aiding individuals in finding their misplaced pension schemes.

You can further this by allocating appropriate resources and raising awareness of this service.

Foster a supportive environment

Foster a nurturing environment where discussions on pension-related topics are encouraged.

Encourage your staff to exchange experiences and advice on tracking down their unclaimed pensions.

Advocate regular updates

Persuade your team to regularly update their details with their pension providers, including alterations to their address, marital status and other personal information.

This habit will aid in easy contact with pension providers, diminishing the probability of unclaimed pensions.

Recent updates on pension policies

HM Revenue & Customs (HMRC) has publicised that starting from the 2024/25 tax year, individuals earning below £12,570 and not receiving tax relief will receive taxable pension contributions directly from HMRC at the end of the financial year.

As of 6 April 2023, the annual allowance to contribute to pensions rose to £60,000, with the eradication of the lifetime allowance.

The upper limit for pension lump sums has been capped at £268,275.

If individuals have protection from the previous lifetime allowance reductions can maintain their protected lump sum, with surpluses being taxed at the marginal rate instead of 55 per cent.

These modifications cover all pension allowances, inclusive of personal pensions such as SIPPS, extending beyond just workplace pensions.

In your role as an employer, aiding your employees in locating their unclaimed pensions not only fosters financial stability but also nurtures trust and accountability in your business.

Start on this vital initiative today and assist your staff in reclaiming the pensions they are duly entitled to.

If you need assistance in tracing unclaimed pensions, get in touch today.

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