Umbrella retirement benefits fund
Most SME’S (Small & Medium Enterprises) have all along been unable to establish a Pension/Provident Fund for the benefit of their valuable employees owing to the cost and legal complexities involved in the establishment of a formal and registered retirement fund.
Going by Government statistics, out of over ten million Kenyans involved in gainful employment, only about two per cent are members of a formal retirement fund. This means that majority of Kenyans retire financially unprepared.
Did you know that most Kenyans live longer in retirement (longest holiday) than the years they spent in employment? British-American has brought this untenable situation to rest with the introduction of British-American Umbrella Retirement Fund.
This is a revolutionary product aimed at unlocking the huge untapped Retirement Fund market, particularly SME’S.
Umbrella Retirement Fund Key Benefits
- Minimum number of employees – 2
- Target Group – SME’S
- Choice – an Employer choose between a Pension and a Provident Fund.
- British-American handles all the administration and trusteeship professionally; thereby relieving the employer of any legal and financial duties/risks associated with administration and trusteeship.
- Cost containment: All SME’S who enroll into the Umbrella Retirement Fund share the cost of running the fund proportionately thereby radically reducing the total annual fund expenses. Resultantly, cost per unit reduces as volume increases. This is a core advantage that really adds value to all members of the fund. Talk of synergy at its best!
- The product is approved and registered with both Kenya Revenue Authority and the Retirement Benefits Authority. In this regard, an employer just signs into the Umbrella Retirement Fund thereby gaining immediate access to the following advantages/benefits:
- Generous Income Tax relief: Employee and Employer monthly contributions are tax deductible on the monthly payroll and on the company annual returns to KRA respectively subject to the applicable limits.
- The investment income under the Umbrella Retirement Fund is exempt from withholding tax in full. Funds therefore accrue faster than elsewhere.
- Benefits payable either on early withdrawal or on retirement are payable tax free up to the applicable limits as set by the Kenya Revenue Authority from time to time.
- Each individual member gets a personalized annual fund statement showing the opening balance, contributions received in the year, interest earned on the opening balance and contributions less expenses then the closing balance.
- Employers who enroll their employees into formal retirement fund enjoy added royalty and increased productivity from the employees.
- Soon after the end of the financial year and after the fund audit, members will be invited for an annual meeting with the trustees and the administrator.
- Optional additional Benefits: members of the Umbrella Retirement Fund can opt to purchase Group Life & Last Expense Cover, Group Personal Accident and Group Medical Cover at competitive premium rates.
As anticipated, the product has been received with a lot of enthusiasm by SME’s and is selling pretty fast. No SME, no matter how small in terms of the number of employees, will fail to join the Umbrella Retirement Fund on account of size; not any more! British-American has given the answer!