With presenters from across Nest, the webinar covered a walk-through of some of the key features of our current member dashboard, discussed steps both individuals and employers can take to provide a more secure future and covered some common queries on using Nest including tips for avoiding late payments and how to amend your contribution rate.
The presentations and live demo are available below to watch again or share with colleagues:
Speakers :
Hosted by Robin Armer, Director of B2B Proposition
Andrew Oldacre – Senior Strategic Account Manager
David Knight – Head of Strategic Account Management
Gary Ball – Senior Technical Account Manager
The slides from the webinar are available here: November webinar slides
After the webinar we received some additional questions, answers can be found below:
Q: Can you show the same example with salary sacrifice 5% employee and 5% employer?
A: For some worked examples please see here
Q: How much can an employee drawn down immediately on at retirement date?
A: A member can, from the earliest age of 55, (57 from April 2028) take the whole pot out as a lump sum. 25% would be tax free and the balance subject to income tax at the member’s marginal rate, with Nest deducting tax at the basic rate. However there are a whole range of flexible options to drawn down cash, an income stream or both and more details can be found here
Q: What is the new risk rating of the Sharia fund now you have added bonds to it. Also Can you opt in/out of the bonds?
A: Following the introduction of sukuk, Nest Sharia Fund volatility is projected to decrease from an annualised rate of 14% to around 10.9%. You cannot opt in or out to that asset class.
Q: I am a bureau and have two ex clients who went into liquidation some time ago. How do I get them removed from my account?
A: To remove an employer from your account: Removing an employer from Nest Connect account | Nest pensions
To notify us first of insolvency if not already done so: Notify Nest of insolvency
Q: Just an observation, given the newly announced increase in Employers NI and another 6%+ in NMW, this adds an additional £1.5 Million to our payroll next year, so I’m pretty sure whilst we would love to increase the employers contribution, I can’t see this happening this for some time….
A: We do recognise the numerous financial pressures on employers right now but we equally wanted to ensure that we covered the most common questions that we get from employers which includes topics such as contribution structures and salary sacrifice, which can also help reduce an employer’s costs by cutting their employer NI liability.
Q: If an employee opts out, is there still a point where they are re-enrolled at a later date?
A: Yes, every 3 years you’ll need to re-enrol workers who are eligible. More info can be found here
Q: If an employee has contributed to Nest but move overseas permanently, can their pot be transferred over to that country’s pension scheme?
A: You can find more information about employees moving abroad here
Q: Is there any chance employee can withdraw his nest pension if suppose he moved from UK.
A: You can find more information about employees moving abroad here
Q: My employees have not yet received their annual statement in their mailbox. They have normally been received by now, is there a delay?
A: We have recently extended the period we issue annual statements by a further 5 month window – it’s now from April to January, so we still have a significant proportion of our membership to issue annual statements to. Please note that your employees may receive statements at different times, even when they work for the same employer. In the meantime their online account will give them an up to date valuation, a detailed contribution history and calculators to provide pension projections.
Q: Can you explain about enrolling from tax date and the alternatives and consequences
A: Regardless of the pay period you operate, be it tax-monthly, tax-weekly, calendar monthly, weekly, fortnightly, or four-weekly (for example); in regulations, your duties start date for an employee and the timeline you need to issue communications and enrol them by is unaffected. However, postponement can be used to help align your duties to your payroll process. It is important that Nest is in line with your payroll system to ensure the processes run smoothly. At Nest we work with all the pay periods mentioned above and these are configured when setting up your group or groups:
Q: If an employee is not eligible but opts in, does the employer have to contribute?
A:If a worker isn’t an eligible jobholder, they can still ask to be enrolled. What you need to do depends on whether they’re what’s known as a non-eligible jobholder or an entitled worker. You can find out more here as to whether the worker in your example would be entitled to an employer contribution or not.
Q: Can salary sacrifice be used to replace the employee’s automatic minimum contributions?
A: A salary sacrifice arrangement can be used to meet the employer’s and employee’s minimum contributions. The difference is that under Salary Sacrifice the whole contribution (e.g. 8% of qualifying earnings) is paid to the pension provider as an employer contribution only
Q: Could we change the set up of the pension from relief at source to salary sacrifice?
A: Yes, you can find out more about using salary sacrifice and how it could work for your business here:
When changing over from Relief at Source (RAS) to Salary Sacrifice it is important to keep your RAS group(s) for any members that do not qualify for salary sacrifice or opt-out of the salary sacrifice arrangement but still wish to be in the pension scheme.
Q: How can a member stop being in the pension scheme after the end of their opt out period?
A: If a worker contacts you wishing to opt out in the first calendar month following enrolment then please direct them to Nest
Q: Is it possible to get welcome pack sent out to an employee a second time, because they frequently say they have no information on their Nest account
A: We cannot re-issue this by post but all the information they need is in their on-line account including their welcome pack in their secure mailbox. If they don’t have their Nest ID to register for their account they can call our contact centre by phone or web chat to get access for the first time :
The general welcome pack that accompanies their welcome letter is also in our document store here
Q: Can you combine 2 pots of pensions if they are both in NEST?
A: At Nest, we have a ‘one pot for life’ feature so members should only have one pension pot that follows them from one Nest related job to another. However, it sounds like on the second time of being enrolled one or more of the member’s details differed in order to generate a second pot. The member can merge their two pots by speaking with our contact centre.
Q: We have several seasonal workers who are on work visas and live overseas and don’t want to pay into a pension pot but are eligible for auto enrolment. We delay auto enrolment, but there is a limit on how long we can do this so they still end up being enrolled. Is there another way to deal with this?
A: The maximum period you can postpone enrolment from your duties start date for a worker is 3 months, at which point you have a legal duty to automatically enrol a worker that meets the definition of an ‘eligible job holder’. If a member does not wish to be in the pension scheme they can opt out within one calendar month of being enrolled and we will refund any contributions already paid via the employer. They cannot opt-out before they are automatically enrolled. If other workers are not ‘eligible job holders’ then they can ask to join to, then whether you have to pay employer contributions as well depends on whether they fall under the definition of a non-eligible job holder or an entitled worker. You also have a 3-yearly re-enrolment duty to review and re-enrol anyone that has opted out previously or ceased active membership after their opt out period. And finally, regulation has set out safeguards to prevent employers from influencing their workers to opt out.
More information can be found here
Q: Can a member take out a lump sum and still continue to add payments going forward?
A: A member can, from the earliest age of 55, (57 from April 2028) take the whole pot out as a lump sum. 25% would be tax free and the balance subject to income tax at the member’s marginal rate, with Nest deducting tax at the basic rate. However there are a whole range of flexible options to drawn down cash, an income stream or both and more details can be found here:
Q: How can we check that you have our members up to date email and mobile numbers
A: A member’s record can be viewed in ‘Manage Workers’ on your employer account which includes email addresses but not phone numbers as we do not ask for this data item when a member is enrolled currently. Member records can be viewed one at a time but there is, deliberately, no bulk download facility for this in order to protect the security of member records. The member provides a phone number to Nest for the first time when they register for their online account. As a digitally led scheme we encourage employers to enrol a worker with an email address wherever possible.
Q: If you wish to access your fund via drawdown – what are the options?
A:Nest does not currently offer drawdown as part of its retirement options so the member would need to consider this option from the open market. However, we do have plans to release a drawdown product in future. More information can be found here
Q: So on a salary sacrifice the employer pays ALL the contributions and the EE pays none?
A: Yes, but only in terms of how the total contribution is paid over to the pension provider. However part of this is effectively the ’employee’s share’, which relates back to the salary sacrifice agreement between the employer and the employee, as the employee’s salary is reduced by the amount of the employee’s contribution.
Please see this page for more information.
Q: If a new employee already has a Nest Account from a previous job will it automatically match up when they are enrolled in there new job?
A: Yes, Nest members should have ‘one pot for life’ so long as their personal information is entered the same when enrolled, in which case the Nest system recognises them as being enrolled again and matches them to their existing pension pot, so they have the same Nest member ID.
Q: Just to confirm is the deduction on the Net Pay or Gross Pay?
A: Nest operates on a Relief at Source basis (when the employer is not operating salary sacrifice). This means that their contribution is deducted as the net amount from the employee’s pay net of tax.
Example: if the earnings in a pay period is £2000 and the employee pays 5%, this equals a gross amount of £100. However, the employer deducts the net amount of £80 (or 4%) from their net pay after tax. When the employer pays it over to Nest, we claim basic rate tax relief of £20 in this example and add it to their pot, making it up to £100. Therefore their contribution is not deducted from gross pay before tax, otherwise the member would receive tax relief twice.
More info can be found here