What is NEST Pensions?

What is NEST?

NEST stands for National Employment Savings Trust.

It is a workplace pension scheme set up by the government to help employers meet their auto enrolment duties.

Many employers choose NEST because it is designed to be accessible for businesses of all sizes.

NEST is one of a number of pension providers that can be used to meet workplace pension requirements.

You can read more about NEST here:
https://www.nestpensions.org.uk

Why was NEST created?

When auto enrolment was introduced, the government wanted to ensure that every employer could access a pension scheme, even if they were small or had only a few employees.

NEST was created to:

• Accept all employers who apply

• Support small and micro employers

• Provide a simple workplace pension option

How does NEST work?

If you choose NEST as your workplace pension scheme:

1. You set up your employer account with NEST

2. Eligible employees are enrolled

3. Payroll calculates pension contributions each pay period

4. Contributions are uploaded to NEST

5. You make payment to NEST by the required deadline

Contributions include:

• The employee’s deduction from their pay

• The employer’s contribution

Both amounts must be paid across to NEST.

What are the employer’s responsibilities with NEST?

If you use NEST, you must:

• Ensure employees are assessed for auto enrolment

• Enrol eligible employees

• Communicate with staff about their pension

• Make sure contribution files are submitted

• Pay contributions on time

You must also:

• Complete your declaration of compliance with The Pensions Regulator

• Re enrol eligible staff every three years if required

Even if payroll is managed for you, the legal responsibility remains with you as the employer.

When must contributions be paid?

Pension contributions must be paid to NEST by the 22nd of the month following the deduction, if paying electronically.

Late pension payments can result in action from The Pensions Regulator.

Can employees opt out?

Yes. After being enrolled, employees have the right to opt out within a set window.

If they opt out within the allowed timeframe:

• Any contributions already deducted must be refunded

• The employer must stop making contributions

If they opt out later, contributions usually remain invested and are not refunded.

Employers must not encourage or pressure employees to opt out.

How Mazuma supports payroll with NEST

When Mazuma processes payroll:

• Pension contributions are calculated correctly

• The required data for NEST is prepared

However, you remain responsible for:

• Ensuring your NEST scheme is active

• Ensuring contribution files are uploaded if required

• Making payment to NEST by the deadline