Auto-enrolment 3rd January 2013
You will have heard of auto-enrolment and the requirement for businesses to provide, and contribute to, a pension scheme for employees (unless you’ve been impersonating an ostrich and burying your head in the sand!)
In addition to new regulations, there is as usual, a whole new vocabulary to get used to before you can begin to prepare. For those of you who think it will be years before it applies to you; you’re wrong. Some aspects of the legislation apply to you now.
There’s a lot for every business to consider including: ‘What is it going to cost me?’, ‘what is my staging date?’, ‘How do I explain auto-enrolment to my staff?’.
The main steps Employers should follow to prepare for auto-enrolment are:
- Know your staging date. There’s an interactive tool available on The Pensions Regulator website at www.tpr.gov.uk to help you find your staging date. You will need to know your PAYE scheme reference and how many people are on your payroll in order to use it.
- Assess your workforce. You need to decide if you have any eligible workers and your duties towards them. If you have more than one employee (possibly including yourself), then you will fall under the new requirements.
- Review any current company pension arrangements, and decide whether to adapt your current scheme or set up a new one.
- Communicate the changes to all your workers, explaining what auto enrolment means for them. AFTER YOUR STAGING DATE YOU MUST:
- Automatically enrol eligible jobholders into a pension scheme
- Register with The Pensions Regulator within 4 months of your staging date.
- Contribute to your workers’ pensions.
- Collect your Workers’ contributions.
Further information about auto-enrolment, opting out, opting in and other information is available by contacting George Farnan. For independent financial advice on other services such as investments, pensions and annuities and corporate tax planning please contact us.