Auto Enrolment. It’s the latest buzzword around payroll processing, but do you know what it is and what you as an employee or employer need to do?
Basically it is the right of anyone in a job to be enrolled in a company pension scheme unless they opt out. This means that employers need to have a pension scheme ready for staff who don’t opt out, and they also need to manage their admin records, know who is entitled to be enrolled in the pension, and record those who have opted out.
There will of course be pension contributions to pay both as an employee and an employer for those that don’t opt out – so you need to be prepared for the costs involved in both cases.
This is being phased in over the next few years, with larger employers already having started on the process. Employers will be given a ‘staging date’ by the HMRC to indicate when you need to be offering the pension to your workforce, but setting up a company pension is not an easy choice or a quick process, so employers really need to be looking at their options well in advance of this date.
If this is not something that you have looked into as an employer yet, I recommend that you get in touch with our preferred financial advisor, Sharon Bassett, of Throgmorton Associates, as they are able to offer advice and guide you through the process. Sharon can be emailed on Sharon@throgmortonassociates.co.uk.
It is worth noting that there are financial penalties for missing your staging date, and also if you try and influence your employees to opt out too. There are also less financial advisors around since January 2013 due to the introduction of legislation which required those giving advice to have additional qualifications.
And to help manage the pension contributions and all the legal duties required by the new Auto Enrolment system, Sage have released Sage 50 Payroll: Auto Enrolment Edition. The new edition includes:
• Creation of an Auto Enrolment preparation plan to coordinate work
• Review of existing pension arrangements
• Forecasts and preparation for the additional costs of providing a workplace pension
• Assistance with communications to employees and to get them ready for Auto Enrolment
• Access to the Sage Community for additional support and information
To find out more about this latest version of Sage 50 Payroll, get in touch with Alison at Silicon Bullet.