It's a pension scheme arranged by an employer where contributions are paid into a plan owned by the employee. The money in the plan is invested on the employee's behalf, and when they retire the fund is used to buy an annuity which gives a regular income for life or can be used to provide an unsecured pension (or an alternatively secured pension if they're 75 or over).
Contributions
You collect the contributions from your employees and administer the scheme, and contributions benefit from tax relief (at the employee's highest rate). You can choose to make contributions to the scheme, and if your contributions are at least 3% of the employee's basic pay it will meet your obligations under the stakeholder pension regulations and you won't be legally obliged to provide any other pension plan for your employees.
As each employee has their own plan within the scheme, they can take it with them if they leave your employment.
How it works
Common questions
Simple answers to common questions.
