Employees can now claim reimbursement on the first £500 of advice fees each year through Pension Advice Vouchers, a new salary sacrifice scheme provider.
Pension Advice Vouchers said it could save employees up to £310 a year - potentially more for a couple - through using the scheme.
First, an employee agrees to sacrifice up to £500 of salary then, once Pension Advice Vouchers confirms the employee has received and paid for pension advice, the employer approves the request and transfers funds tax-free via the scheme. Pension Advice Vouchers said it could also help employees find an adviser.
According to the scheme, some 3.2 million people pay for financial advice each year while a further 12.8 million may have the need for advice. With minimum workplace pension contributions set to rise to 5% in April, it said, the need for good, affordable advice in the workplace has never been greater.
The Finance Act (no 2), which allows employers to fund or reimburse the first £500 each year of pension advice for an employee as a tax-exempt benefit eligible for salary sacrifice, received Royal Assent on 16 November.
The exemption is applicable to "information or advice in connection with the person's pension arrangements", and therefore incorporates holistic financial planning fees that are not ordinarily eligible for tax-efficient payment through pension wrappers.
A survey by adviser directory VouchedFor found nearly three-quarters (74%) of advisers were aware of the new legislation, but just one-in-ten (10%) had acted upon it.
Pension Advice Vouchers said adoption has been low due to the admin work involved for both employers and advisers in verifying employees' requests, although Chase de Vere certified financial planner Patrick Connolly told Professional Adviser it was just lacking momentum.
"I've seen this is being introduced although it's not something we've had first-hand experience with," said Connolly. "It's probably because the vast majority of clients we work with can afford to pay advice fees anyway, or for that matter take money from their pension to pay for pension advice.
He continued: "It's not getting a lot of coverage in the press and it's not high up on people's agendas so it needs a bit of momentum behind it so people realise they are able to do this. A lot of this should be driven by individuals rather than advisers - but individuals won't know they are able to do it."
Connolly said his firm would work with an employee within the scheme and "couldn't see why" there would be any objection from advisers.
Pension Advice Vouchers CEO Adam Price, who is also CEO of VouchedFor, said: "Pension Advice Vouchers removes the hassle of advisers and employers having to verify reimbursement requests with one another.
"It takes IFAs just seconds to log in to VouchedFor, invite their clients to claim a voucher, and verify the advice falls within HMRC's eligibility criteria. The employer simply needs to approve a request, transfer payment and arrange a one-off salary sacrifice."
Tool used in place of triage