Auto enrolment: staging takes a back stage
From October, there’ll be an important change in pension schemes, in particular around auto enrolment, for UK employers to note.
Up until now, an employer would be issued a ‘staging date’ for auto enrolment to commence. This was set by The Pensions Regulator. PAYE schemes set up in September have a staging date of February 2018.
What will be different?
From 1 October 2017, that will change. If you’re an employer who sets up a PAYE scheme on or after that date, you must comply with your duties straight away. This means offering a pension scheme accepted under auto enrolment rules immediately.
Unfortunately, this also means an additional cost and admin burden. And it shows what a difference a day makes. An employer who has registered for PAYE by 30 September 2017 has no legal requirement to offer auto enrolment until February 2018; for an employer who sets up a PAYE scheme a day later, auto enrolment starts with immediate effect.
Will exemptions be affected?
The same exemptions to auto enrolment will still apply. Where there is no legal requirement to offer auto enrolment, such as a director-only payroll with no employment contract, you should still complete the appropriate declaration. This will notify The Pensions Regulator that there is no obligation to operate under auto enrolment. Keep in mind that if you then employ staff at a later date, the exemption ends and auto enrolment applies immediately.
How we can help
We are proactively working with our clients to ensure they are compliant. If you have any concerns about your auto enrolment duties, please get in touch with your usual contact or use our enquiry form.