Under Group Superannuation scheme, the funds are invested scientifically and meticulously. Your funds are a well-researched mix of equity and debt. Since your fund is invested wisely, you are likely to get better investment returns. This will ultimately contribute to your employee’s long term financial goal or savings for their retirement years. Group Superannuation schemes are always fruitful in the long run.
Pension plans for the employees, under Group Superannuation scheme, help in taking care of their retirements. Also, Group Superannuation plans allow multiple payout options yearly, half yearly, monthly, or quarterly. You can also buy annuities that return the premium to nominees in case of death, amounts are guaranteed for as long as you live or even options to increase in annuity benefit each year.
Superannuation scheme has the advantage of extending benefits to employees at a nominal cost. Employees can have a sizable corpus without you bearing a significant and hefty cost. The primary benefit is that a superannuation scheme encourages all the employees to save each month. This is a discipline that can result in large retirement savings for them - something that your employees will be grateful for.
The employer’s contribution is treated as a business expense which reduces your tax incidence. Employees also benefit because the fund is not treated as a perquisite for the employee, which is tax efficient. Moreover, the contribution by the employee towards this policy is eligible for deduction under section 80C. Also, the benefits payable on death and the amount accumulated on maturity are exempt from tax.
Retirement planning is an important aspect of financial security, and a group superannuation scheme is a powerful tool that can help both employers and employees achieve their retirement goals.
By offering a group superannuation plan, employers can attract and retain top talent, while employees can enjoy tax-efficient savings and the peace of mind that comes with knowing they are planning for their retirement.
Whether you're an employer looking to enhance your employee benefits package or an employee planning for your retirement, a group superannuation scheme can provide numerous benefits.
Join us as we explore the world of group superannuation schemes, from understanding how they work to their benefits and considerations, and discover tax provisions on scheme for both employers and employees.
A group superannuation scheme is a retirement plan sponsored by an employer that allows employees to contribute a portion of their income to a fund that is managed by a professional fund manager.
The employer may also make contributions to the plan on behalf of their employees. The contributions made to the scheme are invested in a range of assets such as stocks, bonds, and other securities, and the fund is designed to grow over time to provide retirement benefits to the employees.
Group superannuation schemes offer several advantages over individual retirement plans, such as lower fees, more significant investment options, and the ability to leverage group buying power to negotiate better investment terms.
These schemes are becoming increasingly popular as employers recognize the importance of providing retirement benefits to their employees as part of their employee benefits package.
Group superannuation schemes offer tax advantages to both employers and employees, making them a popular option for retirement planning. Here are some of the tax provisions related to group superannuation policy:
For employees :
For employers :
The organization contributes towards the group superannuation fund created for the employees:
Eligibility for group superannuation scheme is determined by certain criteria, including the following:
In India, superannuation plans come mainly in two types:
The common annuity options that are available are:
Superannuation pension plan is a fund managed by the employer. The claims or transfers of these funds can only be made under the scenarios mentioned below:
Documents submitted for claims under group superannuation scheme differ by type of claim, the insurance company and the type of scheme taken. Below are a few general documents that are required to claim for a group superannuation scheme:
Group superannuation plans are a cost-effective and tax-efficient retirement planning option that benefits both employers and employees. The scheme provides a wide range of investment options and lower administrative costs, and employers can use it to attract and retain top talent.
While it's essential to consult with a financial advisor or tax professional to ensure the scheme aligns with your retirement goals and financial situation, group superannuation schemes are a popular and effective tool for achieving long-term financial security.
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