Auto Enrolment: Boring, But Very Important!
Is your business compliant yet?
POSTED BY JONATHAN VOWLES ON 19/09/2017 @ 8:00AM
Regulation is a fact of life in business. From simple stuff like sending your VAT return online, to Health and Safety risk assessments. And now there are auto-enrolment workplace pensions ...
If you're not yet compliant with auto-enrolment workplace pensions, then you need to talk to us!
copyright: the pensions regulator
Part of the information published by the Pension Regulator talks about sending warnings and fines to 'nudge' businesses into compliance. Data from the Pensions Regulator shows that they carried out 276 inspections in the last quarter, issued nearly 5,000 fixed penalty fines of £400 and issued 1,384 EPNs ranging from £50 to £52,000.
"Do you fancy getting a fine to nudge you to be compliant?"
An EPN is an escalating fine notice, in other words, bigger fines. So far only 78% of employees have been included in auto-enrolment and there are about another 700,000 small businesses that need to get it sorted.
Like a lot of legislation, Auto Enrolment Workplace Pensions have been well publicised by the government ... and like a lot of regulations, not everybody understands what they have to do or has done it by their deadline.
What is telling is that each quarterly report from the Pensions Regulator shows that more and more businesses are being fined. In other words, more and more people aren't checking they have it right and are only realising they have got it wrong when it's too late.
What is going to happen in the next three months? Are you going to be one of the businesses that get fined? If you don't understand what you have to do, then you need to get yourself up-to-speed quickly:
Every business that has employees needs to comply with the rules, although sometimes complying doesn't involve setting up a pension scheme, it normally does.
And that means a small amount of cost and hassle. You don't need to involve an IFA or regulated pensions adviser, although you might want to. Probably the best place to start asking is your accountant or payroll provider. But not every accountant does this. If you want our help, then we have a low-cost solution so do get in touch.
Know when your deadline is! If you don't know your deadline, how do you even start taking control? Importantly, you need to start taking action about three months before your deadline. Setting up an auto-enrolment pension scheme can take a while so don't get caught out because you didn't plan far enough in advance.
Assess your workforce. Note that it is possible for someone who is a worker, but not an employee, to be considered within auto-enrolment!
This assessment will show you how your employees are categorised and therefore approximately what auto-enrolment workplace pensions will cost you on a month to month basis. For most people, it works out at about the same as 3 or 4 pints of beer per month, so it doesn't have to be expensive.
Do something now! Being compliant is cheaper than getting fined, so get yourself organised and if you don't have the time to do it all yourself then delegate it.
Finally, auto-enrolment workplace pensions mean more costs for your business. So review your pricing. Is it time to put your prices up?
If you do nothing else after reading this blog post, know what your staging date is and don't fail because you ignore the rules.
"Would you like to know more?"
And, of course, if you want our help, we are only too willing so get in touch with us on 01234 752 566 or click here to ping us an email and let's get you compliant.
Until next time ...
More about Jonathan Vowles ...
I've been an accountant in and for business since 1987 and have a wide experience of consultancy, audit, accounts, taxation and wealth planning work from individuals and small businesses to multinational corporations and charities.
My eclectic interests in growing and developing business span a number of areas, which can be summarised as strategic business advice and tax saving advice.
I have worked with the Chamber of Commerce to deliver courses for people about starting up in business and have lectured about tax for a major accountancy practice and for Milton Keynes College.
I relax by reading fiction and by getting away from the office in a campervan.
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