Currently, individuals with an adjusted taxable income in excess of PS150,000 pay income tax at 45 per cent, and receive tax relief at their marginal rates on money purchase pension
contributions up to the annual allowance of PS40,000 (assuming Money Purchase Annual Allowance does not apply).
However, it is a condition for Fixed Protection that no more contributions, (whether paid by the pension holder, their employer or a third party), can be paid into a money purchase pension
scheme and the amount of benefits that you can build up in a defined benefits (final salary) or cash balance scheme will be limited.
Most of the plans available to small businesses--simplified employee pensions (SEPs), salary reduction simplified employee pensions, SIMPLE IRA plans, SIMPLE 401(k) plans, regular 401(k)s, profit-sharing plans, money purchase pension
plan, Keogh plans, defined benefit plans, defined contribution plans, and employee stock ownership plans--are subject to the minimum coverage requirements, minimum vesting standards, the actual deferral percentage test, the non-discrimination requirements, and the top heavy plan requirements.
Money Purchase Pension
Plan--Requires the employer to make fixed annual contributions as a percentage of compensation to the plan.
Our money purchase pension
arrangements have been reduced, wage increases ceased or postponed, our working terms altered and many have lost employment with minimal statutory redundancy payments.
The above said, this is now all rather academic as the Government has confirmed that contracting out of money purchase pension
arrangements will be abolished with effect from April 6 2012.
As your cash flow improves, or as you add employees, you may want to consider changing to a profit sharing, money purchase pension
or 401(k) plan.
New workers will now only be eligible for a money purchase pension
which does not guarantee benefits.
The survey summarizes the most popular components of investment policy statements for defined benefit plans, 401(k) plans, money purchase pension
plans, 403(b) plans, and welfare plans.
Corporation 3, for example, maintained an 8-percent-of-compensation money purchase pension
There are 33 days' holiday (pro rata) and employees can choose from final salary or money purchase pension
arrangements, giving the flexibility to select the pension that suits best.
Participants in Hanover's The Company Store Savings and Money Purchase Pension
plans and the Retirement Plan for Union Employees are prohibited from purchasing the stock pending completion of the company's investigation of accounting matters.