Employer Sponsored Pension Schemes
An Employer-Sponsored Pension Scheme is a retirement savings plan established by an employer to provide pension benefits to its employees. In Ghana, under the National Pensions Act, 2008 (Act 766), employers are mandated to set up and manage pension schemes for their employees. These schemes typically include Tier 2 (Mandatory Occupational Pension Scheme) and Tier 3 (Voluntary Provident Fund) components, both of which can be administered by licensed corporate trustees like Standard Pensions Trust.
Key Features
Full Scheme Ownership
Organizations retain complete control over their pension schemes, ensuring alignment with corporate objectives and employee needs.
Professional Trustee Services
As a licensed corporate trustee under the National Pensions Regulatory Authority (NPRA), Standard Pensions Trust provides expert management and oversight of pension funds.
Flexible Fee Structure
Fees are customized based on the specific requirements and scale of each organization, ensuring cost-effectiveness and transparency.
Comprehensive Scheme Management
Expert administration of both Tier 2 (occupational pension) and Tier 3 (provident fund) schemes, including compliance with NPRA regulations and timely reporting.
Scheme Options
Tier 2 – Occupational Pension Scheme
A mandatory, fully funded scheme where both employer and employee contribute to a retirement fund managed by a licensed corporate trustee.
Tier 3 – Provident Fund Scheme
A voluntary, fully funded scheme offering tax reliefs and serving as a financial vehicle for members seeking enhanced pension benefits.
Contribution & Tax Benefits
Tier 2 Contributions: Employers contribute 5% of an employee's basic salary, with the option for additional voluntary contributions.
Tier 3 Contributions: Employers and employees can contribute a combined total of up to 16.5% of the employee's basic salary, with tax exemptions applicable to contributions up to this limit.
Benefits of Employer Sponsored Schemes
Enhanced Employee Retention
Offering robust pension schemes can improve employee satisfaction and retention rates.
Tax Efficiency
Contributions to both Tier 2 and Tier 3 schemes are tax-deductible, providing financial benefits to both employers and employees.
Financial Security for Employees
Employees benefit from structured retirement savings, ensuring financial stability in their retirement years.
Regulatory Compliance
Standard Pensions Trust ensures all schemes comply with NPRA regulations, mitigating legal and financial risks for employers.
Why Employer-Sponsored Pension Scheme?
Enhanced Employee Retention
Offering a robust pension scheme demonstrates a commitment to employee welfare, fostering loyalty and reducing turnover.
Attractive Tax Benefits
Contributions to Tier 3 schemes up to 16.5% of an employee's basic salary are tax-deductible, providing significant tax savings for both employers and employees.
Financial Security for Employees
Employees benefit from structured retirement savings, ensuring financial stability in their post-employment years.
Regulatory Compliance
Employers ensure adherence to the National Pensions Act, mitigating legal risks and penalties.
Customizable Plans
Schemes can be tailored to meet the unique needs of the organization and its workforce.
Scheme Overview
| Feature | Details |
|---|---|
| Contribution Rates | Employer and employee contributions as agreed upon; Tier 2: 5% (employee), Tier 3: Up to 16.5% (voluntary) |
| Tax Reliefs | Contributions up to 16.5% of basic salary are tax-deductible |
| Withdrawal Conditions | Tax-free withdrawals after 10 years for formal sector employees; early withdrawals permitted under specific conditions |
| Loan Facilities | Access to secured loans at competitive interest rates using accumulated funds as collateral |
| Professional Management | Managed by NPRA-licensed trustees and fund managers |
| Digital Services | Online portals and mobile access for account management |
| Portability | Funds are transferable when changing employment |
Ready to discuss an Employer Sponsored Scheme for your organization?
Contact us today to learn more about how we can tailor a pension solution to meet your company's needs.