PENCOM Certificate and when a company is eligible for one
PENCOM certificate is given by the National Pension Commission (PENCOM) which is a body that regulates and supervises pension matters in Nigeria. The body was created to ensure the effectiveness of retirement benefits disbursed in accordance with the law.
A PENCOM certificate is given as evidence of compliance with the Pension Reform Act. Accordingly, the Pension Reform Act states that any Public servant in the public sector and also every individual in the employment of a private organisation of at least three persons (Section 2(2)(3) of the Pension Reform Act 2014) must be part of the PENCOM scheme. Hence, the employers are required to pay 10 percent of the monthly incomes of the employee and 8% from the employee income. The PENCOM certificate is given to companies upon application to show that they have complied with this aspect of law as required by the Pension Reform Act (2014).
The eligibility for a company to qualify for this certificate is as stated below;
- Certified list of all the employees in the organisation to be done by an authorized agent.
- Up to date statement on the payment of the specified rate of 10% by the employer and 8% by the employee of monthly emolument which is the monthly contribution.
- There must be evidence of monthly remittances of all employees in the company in the last three fiscal years for a company in existence for more than five years and for companies that have not been in existence for more than three years, from the date of incorporation.
- There must be evidence of Life insurance policy for the employers.
- Evidence of remittance of outstanding pension contribution and penalties where applicable.
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