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PENSION FUNDS MANAGEMENT :: Frequently Asked Questions
What is a Pension Plan?
A pension plan is a benefit provided by the employer, which serves the main purpose of providing an income for its members after they have retired. The member's pension will therefore become his source of income when his working life has ceased.
Does my Employer make pension contributions on my behalf?
Yes. The Employer must contribute to the Pension Plan on behalf of each member to assist in providing a benefit for the members at retirement.
Who may join a Pension Plan?
All permanent members of staff who have completed their period of probation at the effective date (start) of a Plan may join. All permanent staff members employed after the effective date (start) of a Plan must join the Plan upon completion of their probationary period.
What are the benefits of contributing to a pension plan to members?
- Pension Plans offer tax savings of 25% on pension contributions, as contributions are deducted before tax.
- The pension contribution is deducted before income tax and other statutory deductions, therefore you receive a higher net pay while saving for retirement.
- Returns on pension fund investments are tax-free.
- Your termination refund is tax-free.
What are the benefits of contributing to a pension plan to the employer (sponsor)?
- Provides an income to employees after they have retired
- Reduce adhoc demands on companies
- Can enhance employee loyalty
- Tax efficient for employer
Will I have a say in the running of the Pension Plan?
The Pension Plan is governed by Trust Deed & Rules and managed/supervised by at least three (3) Trustees. There must be at least one (1) representative of the members on the board of Trustees for the Plan.