1.5 MILLION EMPLOYERS TO GET A LETTER FROM THE PENSIONS REGULATOR
The Pensions regulator (TPR) announced this week that it is to write to all around 1.5m businesses to remind them about what they will need to do under the automatic enrolment legislation, writes Gareth Tregidon, Financial Planning Manager at Bevan & Buckland.
All small and micro employers will receive a letter at some point in the next 6 months from TPR focusing on what employers will be required to do and by when. The aim is that, by the summer, all employers will know what their Staging Date is (the date the legislation affects them) and what they will need to have in place by then. Staging Dates are being phased in, starting with the largest employers in 2012 and running through until 2017. The full text of the announcement can be found on TPR’s website here.
The auto enrolment legislation is one of the biggest changes to employment and pensions laws ever, and introduces a requirement on employers to provide pensions for their staff. However, the laetters have already been criticised as some employers have received them in error.
Whilst the legislation is designed to cover all employers, those limited companies with a sole Director (and no employees – a “one-person company”) are exempt. If this matches your scenario and you receive a letter from TPR, our advice is to speak to them as soon as possible to check what details they hold about you. Otherwise, you will be required to comply with the legislation in the same way as everyone else.
One of the main aims of the letters is to ensure that employers do not leave their planning too late. As we have seen for those clients who have already reached their Staging Date, the implementation of an auto enrolment strategy can take several months, and even longer if you are trying to do it yourself as well as running your business.
Equally as important is to make sure you get advice from the right people.
Auto enrolment is not just about setting up a pension. As important is ensuring that your payroll software is set up correctly, and that it will integrate properly with your chosen pension provider. Many traditional pension companies will not offer smaller employers terms, and so finding a provider and making sure all of the various systems will work together is essential. We have had several cases where employers have taken advice from financial and other advisers who did not understand these links well enough, resulting in additional work (and expense) in trying to sort everything out. If you are going to seek advice, make sure it is from someone (like us!) who understands payroll as well as pensions.
If auto enrolment will affect you in the next 12-18 months, we are holding a free seminar in Swansea on Thursday 12th February 2015. In addition to payroll and pensions we will also be covering the employment law aspects which smaller employers will need to consider. To register, please click here.
If you are not able to attend the seminar, but would like to find out what is involved and where Bevan & Buckland can help, please do not hesitate to contact us.
Financial Planning Manager
Gareth Tregidon is manager of Bevan & Buckland’s Financial Planning Department, which operates from the firm’s Swansea, Pembroke and Haverfordwest offices. The department provides fee-based advice to personal and business clients, both from within the firm and elsewhere.
Gareth is a Certified Financial PlannerCM and an accredited Later Life Adviser with the Society of Later Life Advisers (SOLLA). He is former Chairman of the Institute of Financial Planning in South Wales, and an assessor for the internationally recognised Certified Financial PlannerCM licence.
Bevan & Buckland Chartered Accountants Swansea Tel: 01792 410100
Bevan & Buckland Chartered Accountants Haverfordwest Tel: 01437 760666
Bevan & Buckland Chartered Accountants Pembroke Tel: 01646 682383
Bevan & Buckland Chartered Accountants Carmarthen Tel: 01267 233115
Bevan & Buckland Chartered Accountants St David’s Tel: 01437 720352