Workplace pensions (also known as automatic enrolment) were introduced as a major reform to UK pensions. Under these reforms:
- all employers in the UK must offer a qualifying workplace pension to their workers
- all eligible workers must be automatically enrolled into the chosen scheme (even if they subsequently decide to opt out)
- the employer is required to pay a minimum level of contribution in respect of their workers. The tiered system of contributions starts at 1% and is stepped until it reaches 3% employer contribution by 2018
These reforms commenced implementation in October 2012 and this will continue until October 2017.
The Pensions Regulator will write and give you 12 months notice of your staging date ie the date by which your new scheme needs to be in place.
We strongly recommend that you find out your staging date in advance of this so that you can be aware of your additional financial obligations and begin the planning process as soon as possible.
The initial and ongoing requirements are incredibly complex. The regulator can and will impose heavy fines on employers that do not comply. We suggest that you need to start planning at least 12 months ahead of your staging date to ensure that you comply with the requirements from the perspectives of the pension scheme and your payroll operation.
Don’t forget also that workplace pensions may apply to people you employ at home such as a nanny or cleaner.
As independent financial advisers, we are ideally placed to provide a straightforward approach to help you review the impact of auto enrolment on your business, advise you on the most appropriate workplace pensions scheme and then help you with implementation. We have already helped many clients through the process and so we are aware that the reality of implementation is much more complex than the bullet points above may suggest.
As well as advising on the pension scheme selection and set up, we will also be able introduce you to Cassons Accountants and Business Advisers (part of the Baldwins Group) who can give hands on support on the day to day implementation. The obligations from the workplace pensions regime everytime the payroll is run are strenuous so we are finding that many clients are keen move their payroll to a payroll bureau such as that of Cassons Accountants and Business Advisers (part of the Baldwins Group). If you choose to keep your payroll in house they can advise and quote on the purchase of upgraded Sage Payroll software. You can discover more about Cassons Payroll Bureau by visiting our website here.
Call us now on 0345 337 9409 to find out how we can help you or send us an email.
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