Auto-Enrolment Pensions Advice

Auto Enrolment will land heavily on the doorstep for the majority of small businesses in 2016 and 2017. Do not bury your head in the sand! It is real and it is here. Take action sooner rather than later!

Regardless of the size of your business and who gets paid, if you have a PAYE scheme in place you will have a Pension Staging date. It is as simple as that. Even if it is simply a payroll for Directors only - it still applies and you still need to do something about it. You will receive, or already have, a letter from the Pensions Regulator.

Do not ignore it as there are no acceptable excuses - You will be fined heavily and could even face prosecution!

What do i need to do?

  1. Find the letter from the Pensions Regulator and make sure your contact details are correct. If you have lost the letter call the Pension Regulator straight away. They will issue a duplicate.
  2. Find out your pension staging date – you cannot be late in getting ready for the staging date as you will incur both a one-off and then daily fines.
  3. Identify a Pension provider as soon as possible. And remember that a lot of the pension companies are overwhelmed and are not accepting smaller companies into their schemes. You may have to choose some of the “capture all” pension providers like, among others, Simply Pensions, Now Pensions, Nest, Peoples Pensions, etc. Make sure you shop around for the best deals for your employees and get independent  advice if need be.If you have employees, you must check your workforce status. Gather together all their details like name, date of birth, hours, salary, etc. Make sure all your employees records are up to  date.
  4. Identify your employee’s eligibility, it is  based on age and earnings – and beware. Eligibility can change at each pay period as age changes and earnings can too!
  5. Familiarise yourself with jobholder definitions:     
    • Eligible jobholder:  Must be automatically enrolled into auto enrolment scheme and both employer and employee contribute.
    • Non-eligible jobholder:  Employer must provide the employee with information about the auto enrolment scheme, and if the employee chooses to opt in both the employer and employee contribute.
    • Entitled worker:  Employer has to write to employee to inform them of the pension scheme. If the employee chooses to opt in the employer does not have to contribute.
  6. Each stage of the process involves a letter-writing exercise and an employer should keep a record of this. This is vital, as an employer will rely on this documentation as evidence if an employee says they knew nothing about a pension scheme and were never offered one. There are serious fines for not communicating with your employees about Auto Enrolment initially and ongoing.

It is an employer’s legal obligation to issue a statement of main terms within 2 months of an employee commencing employment – employers without contracts need to get them in place now. Statement of main terms needs to include the pension details. Policies need to include mention of pensions, rollout and communication process, including opt-out procedures.

If you are unsure, have any questions or require our help, please do not hesitate to call us on 0208 858 4303 or email on

Looking for an Accountant who is Auto-Enrolment Ready?  See our Service:   Auto Enrolment

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