The provident fund covers voluntary tier 3 contributions and personal pension scheme up to 16.5%.
What are the tax benefits?
Like tiers 1 and 2, the tier 3 is also tax deductible for either the employer or employee.
What are the non-tax benefits for employers?
Beyond the tax incentives, employers can benefit by contributing to employees tier 3 plan and defining a vesting period, to which an employee does not own the employer’s contributions until after a specified period of time. By doing this, employers can increase employee morale, and better attract and retain the best quality workers.
What are the non-tax benefits for employees?
Employees have more control over how their funds are managed than in previous pension schemes. Because the Trustees take direction and are selected partially from employee input, they do with the funds as they are advised from their electors. Additionally, employees can use their benefit to secure a mortgage for a primary residence.
How much can one contribute?
Employees can contribute as much as they like to retirement, but there are limits to the tax advantages for contribution. Employees are obligated by law to contribute 5.5% of their pay to the tiers 1 and 2, but there is no obligation for the voluntary tier 1 contribution which limits tax exemptions to no more than 16.5% of a worker’s salary in the formal sector. Should a worker wish to contribute more, REGAL has provident funds for all types of retirement investments beyond the limits of the Law. The informal sector can contribute up to 35% of their income to a tier 3 scheme.
Choose REGAL as your provident fund manager and be assured of good consistent returns and growth of investment
