Complete Auto Enrolment Service, from Planning, advise to Implementation and maintenance.
What is auto-enrolment & who does it apply to?
The government had become concerned that the UK’s workforce was not putting enough away for their retirement. As a result, the automatic pension enrolment scheme came into force in 2012, making it mandatory for employers to enrol all eligible workers into a workplace pension.
All UK businesses are now legally required to operate an auto enrolment pension scheme for qualifying employees, comprising of employer and employee contributions. To be eligible:
- You must be aged at least 22
- AYou are below state pension age
- You earn more than £10,000 a year in 2020/21
- You work in the UK.
You must comply with the Act if you own a business that employs one worker or more. You will need to:
- Set up a workplace pension scheme that meets the new rules
- Automatically enrol all eligible workers
- Pay contributions into the retirement pots (pensions) of eligible workers
- Enrol other workers if they ask to join the scheme
If you have started your auto enrolment duties and are struggling with the additional financial and administrative requirements, we can offer you a fully compliant auto enrolment services to support you and your business through successful implementation and ongoing compliance.
We now carry out the final stages of the auto enrolment process. This will help you as an employer keep track of who is entitled to join, manage pension payments and data as well as communicating with your pension provider and staff.
By this stage we will have:
- Set up your pension scheme
- Have all employees registered
- All relevant contributions calculation through your payroll.
- Set up any integrations of your payroll with the Pension provider
- Submit the required information to your Pension provider.
You will then need to make the necessary payment and we will walk you through different options available.
The final stage of the implementation process will be to submit the Declaration of Compliance (needs to be done within 6 months of staging date).
The declaration provides information to show that the business has met all auto enrolment duties.
This step must be carried out to ensure full auto enrolment compliance.
Exemptions from auto-enrolment
Automatic enrolment duties do not apply when a company or individual is not considered an employer or if you meet one of the following criteria:
You won’t have any duties if you meet one of the following criteria:
- You are a sole director company, with no other staff
- Your company has many directors, none of whom has an employment contract, with no other staff
- Your company has many directors, only one of whom has an employment contract, with no other staff
- Your company has ceased trading
- Your company has been dissolved
- You no longer employ people in your home (cleaners, nannies, personal care assistants, etc.)
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Your employer will automatically enrol you into a pension scheme and make contributions to your pension if you're eligible for automatic enrolment. If your employer does not have to enrol you by law, you can still join their pension scheme if you want to.
Yes, you can leave (often referred to as 'opting out') if you want to. If you do opt out within a month of your employer adding you to the scheme, you'll get back any money you've already paid in. You may not be able to get your payments refunded if you opt out later - they'll usually stay in your pension until you retire.
The scheme will normally pay out the value of your pension pot at your date of death. This amount can be paid as a tax-free cash lump sum provided you are under age 75 when you die. The value of the pension pot may instead be used to buy an income which is payable tax free if you are under age 75 when you die.
If you are an existing member of a workplace pension scheme and it meets certain minimum standards (ie a ‘qualifying scheme’), you will not be affected by automatic enrolment. However, if contribution levels fall below the minimum contributions for an automatic enrolment scheme, you and/or your employer may need to start or increase contributions.
For people with more than one job, each job is treated separately for automatic enrolment purposes. You can still opt out of individual schemes if you want. Each of your employers will check whether you’re eligible to join their pension scheme. If you are, then you’ll be automatically enrolled in that employer’s workplace pension scheme.
In April 2019 the minimum contributions for a qualifying pension scheme rose to 8% (on a band of earnings). There are no planned increases in April 2020, so the increase in the estimate of contribution costs this year relative to the previous year will be driven by growth in your earnings.