An employer can contract out of the SERPs element out of the state pension scheme (hence qualifying for a contracted-out rebate on NIC's ) by means of an occupational pension scheme. There are strict rules relating to occupational pension schemes generally and contracting-out. Benefits under a contracted-out scheme must be at least as good as SERPs benefits and such schemes must ensure a "guaranteed minimum pension". An occupational pension scheme need not be contracted out. Occupational pension schemes set up by smaller companies are often insured - whereby an insurance company takes over all responsibilities in return for a premium.
Easyform Glossary of Law Terms. — UK law terms.
Employment which is contracted-out of the state second pension (S2P) (formerly the state earnings-related pension scheme (SERPS)). Members of contracted-out schemes forego their S2P or SERPS pensions and instead are provided with minimum benefits under their employer's pension scheme. Both members and employers pay lower national insurance contributions (NICs) if they participate in a contracted-out scheme (contracted-out money purchase scheme). National Insurance Services to Pensions Industry (NISPI) is responsible for supervising contracted-out schemes and issues contracting-out certificates.
Practical Law Dictionary. Glossary of UK, US and international legal terms. www.practicallaw.com. 2010.
Look at other dictionaries:
contracted out — ➡ S2P * * * … Universalium
contracted out — /kənˌtræktɪd aυt/ adjective referring to a member of an occupational or personal pension scheme who is not a member of SERPS … Dictionary of banking and finance
contracted-out employment — United Kingdom Employment which is contracted out of the state second pension (S2P) (formerly the state earnings related pension scheme (SERPS)). Members in contracted out employment forego their S2P or SERPS pensions and instead are provided… … Law dictionary
contracted-out money purchase scheme — (COMP scheme) A money purchase scheme that has contracted out of the state second pension (S2P). To qualify as a COMP scheme, the scheme must satisfy certain criteria set out in the Pension Schemes Act 1993. In particular, the empl … Law dictionary
contracted-out salary-related scheme — (COSR scheme) A salary related pension scheme (salary related scheme) that has contracted out of the state state second pension (S2P). To qualify as COSR scheme, the scheme must satisfy prescribed requirements, set out in the Pensi … Law dictionary
contracted-out salary related scheme — (COSR scheme) A salary related pension scheme (salary related scheme) that has contracted out of the state state second pension (S2P). To qualify as COS … Law dictionary
contracted out salary related scheme — (COSR scheme) A salary related pension scheme (salary related scheme) that has contracted out of the state state second pension (S2P). To qualify as COS … Law dictionary
Contracted — Con*tract ed (k[o^]n*tr[a^]kt [e^]d), a. 1. Drawn together; shrunken; wrinkled; narrow; as, a contracted brow; a contracted noun. [1913 Webster] 2. Narrow; illiberal; selfish; as, a contracted mind; contracted views. [1913 Webster] 3. Bargained… … The Collaborative International Dictionary of English
contracted hoof — a condition in a horse s hoof in which it becomes dried out and reduced in size, which causes inadequate pressure on the frog and lameness. Called also contracted foot and contracted heel … Medical dictionary
contract out — phrasal verb Word forms contract out : present tense I/you/we/they contract out he/she/it contracts out present participle contracting out past tense contracted out past participle contracted out 1) [intransitive] British to agree by a written… … English dictionary