For the purposes of this document, any references “to the Company” refer to all companies within Uniper*.

Q. What are the benefits of the Bonus Waiver option? 

A. By opting to waive some or all of your bonus for a corresponding employer pension contribution, the Company will make a tax and National Insurance free contribution into a Uniper Pension Plan (UPP)  account. This is therefore a tax efficient way of using your bonus funds to boost your pension savings.

Q. I am interested in the Bonus Waiver and would like to know whether I am eligible for this option. 

A. The Bonus Waiver is being offered to all employees, and this includes those employees who are members of the Uniper Pension Plan (“the UPP”) and the Final Salary and Retirement Balance Plan (“the RBP”) categories of the Uniper Group of the Electricity Supply Pension Scheme (“the ESPS”).

Q. How much bonus can I sacrifice? 

A. You may elect to sacrifice all or a percentage of your discretionary annual bonus (from a minimum of 10% in 10% increments up to a maximum of 100%) to be invested into your pension.

Q. If I choose to waive a percentage of my bonus for a pension contribution, what happens to the rest of my bonus? 

A. If there is any remainder of the bonus not paid into your pension, such payment will be payable to you in cash via payroll under PAYE subject to deduction of tax and National Insurance contributions as appropriate.

Q. Why am I being asked whether I want to waive some or all of my bonus now when I do not know how much I will receive? 

A. In order to meet the HMRC requirements of a bonus waiver scheme, an employee must opt to sacrifice all or part of their bonus before it is paid.

Q. Can I waive any other bonuses I am entitled to? 

A. No. The Bonus Waiver benefit is only applicable to your discretionary annual bonus due in April.

Q. Are there any disadvantages? 

A. If some or all of your bonus is waived in exchange for a pension contribution it cannot normally be accessed until you take your pension benefits. The earliest age you can usually do this is 55 (57 from 2028). From this point, under current legislation, you can usually take up to 25% tax free with the remainder paid as taxable income. Monies paid to your pension are based on your decisions where to invest the money. Please bear in mind all investments, including the default fund in the UPP, can fall as well as rise in value so you could get back less than you invest. 

Waiving some or all of your bonus will reduce your earnings and therefore may reduce your entitlement to state benefits, such as Statutory Maternity Pay, which are based on either earnings or National Insurance contributions.

Q. What happens if I don't want to participate? 

A. If you do not want to participate, there is no need for any action. You will continue to be eligible to receive your bonus subject to the usual bonus scheme criteria.

Q. Do I need to declare my waived bonus on my tax return?

A. As the pension contribution paid in exchange for your waived bonus is determined as an employer contribution and it has been paid free of tax and National Insurance, it should not be declared on your tax return.  

Q. Does the Company expect to offer the Bonus Waiver option each year? 

A. The intention is to offer this option on an annual basis going forward, although the Company reserves the right to withdraw this facility at any time.

Q. I have since changed my mind and want to have my bonus paid as cash instead. Can this decision be reversed?

A. Please note that this election cannot be changed once you have opted for it and therefore you should consider this decision carefully before proceeding.

Q. What do I need to know about pension allowances?

A. Most people can contribute as much as they earn into a pension each year and get tax relief up to their highest rate, however both annual and lifetime limits apply in most circumstances:

Annual Allowance

For most people, a £40,000 contribution limit applies for the tax year. If you were in Flexible Drawdown prior to 6 April 2015, or you have made any income withdrawals from a money purchase pension since 6 April 2015, contributions to money purchase plans may be restricted to £4,000 - exceptions apply. Also, your allowance may be tapered down if your ‘Adjusted Income’ is £240,000 or more. Adjusted Income is broadly all taxable earnings (including sources of income outside of your employment, e.g. rental income) plus the value of employer pension contributions, including those derived from salary sacrifice and bonus waiver.

Please also see http://www.hmrc.gov.uk/tools/pension-allowance/

Lifetime Allowance

Further information in relation to the Lifetime Allowance can be found on the Government’s website: https://www.gov.uk/tax-on-your-private-pension/lifetime-allowance

Q. As a UPP contributing member, does this affect how much I can pay into my pension before I face a possible tax charge for breaching the Annual Allowance? 

A. It is important to note that this is your responsibility to check your Annual Allowance position. 

So long as all of your pension contributions during the tax year remain within your Annual Allowance, you will not incur a tax charge by opting for the Bonus Waiver. However, it is also important to note that as neither the Company nor the Trustees of the ESPS know what other pension arrangements you may be contributing to outside of the Company they cannot undertake any calculations for you.

Further information in relation to the Annual Allowance can be found on the Government’s website: https://www.gov.uk/tax-on-your-private-pension/annual-allowance

Q. As an existing UPP member, will I receive anything from Fidelity if I am already a contributing member to the plan? 

A. No. A new joiner pack will only be sent to you if you are a contributing member of the ESPS and you opt to sacrifice some or all of your bonus by accepting a pension contribution into a new UPP account set up for you.

Q. As an existing UPP member how is my Bonus Waiver contribution invested? 

A. An existing UPP member will have the pension contribution payment invested in the same way as their existing UPP account. You can change your investment choices by using Fidelity's secure online PlanViewer service (available via the My Choice landing page) or by calling their Pensions Service Centre on 0800 3 68 68 68.

Q. Are there any other considerations? 

A. Neither the Trustee or Company is able to provide you with individual investment or financial advice. You should note that at all times it remains your responsibility to monitor your pension position and that you are solely responsible for any tax, National Insurance or other liability that may arise if the Annual Allowance or Lifetime Allowance were to be exceeded.

Q. Please could you provide some examples of how the Bonus Waiver works? 

A. The following are examples of how the Bonus Waiver works for both a basic and higher rate tax payer waiving some or all of their bonus for a pension contribution. Please note that these examples are intended for illustrative purposes only and should be used accordingly. 

The examples below illustrate the tax savings Bonus Waiver can make to a £1,000 bonus:

 Please note:

• If you choose to waive a percentage of your bonus, we cannot display predicted savings based on your circumstances.
• The exact tax and National Insurance treatment depends on your individual circumstances at the date of deduction and the accurate details will reflect in your payslip. 
• Any bonus awarded by the Company will be assumed to be paid in the 2024/25 tax year.
• Not only is the contribution tax-efficient if you pay your pension through salary sacrifice, but any gains from your investments in your pension are also sheltered from UK Capital Gains Tax.
• The bonus waiver contribution will have the same tax and National Insurance treatment applied as your regular contributions. If your regular pension contributions are paid via non salary sacrifice, any bonus waiver pension contribution will also be non-salary sacrifice.
• Please see the Useful Links section of Mychoice for important notes regarding pension allowances to check if you are subject to any restrictions.

* Uniper UK Limited, Uniper Technologies Limited, Uniper Global Commodities (London) Limited  and Uniper Energy Trading UK Staff Company Limited.