In March 2015, a total of 5.2 million eligible job holders were automatically enrolled and around 35,000 employers had completed their declaration of compliance, according to The Pensions Regulator. This year, around 45,000 employers will reach their staging date, but that’s only the tip of the iceberg. Next year 45,000 businesses per month will be required to comply.
Most small owner-managed businesses with fewer than 30 employees will have little or no time to deal with the amount of administrative work that comes with auto enrolment, not to mention the payroll expertise.
It seems that many of the traditional pension providers, often large, well-known insurance companies, are being choosy about the smaller businesses and their schemes, deeming them not as profitable due to the smaller number of employees and contributions being paid.
So what can small businesses do now?
- Start the process 9 to 12 months ahead of your staging date. Identify a suitable provider and discuss what you want from your scheme.
- At least 6 months before your staging date start setting up your pension scheme with your chosen adviser. Don’t think that because you employ fewer than 30 people it will be quick and easy.
- Don’t assume that you can use your existing pension scheme, if you have one. It may not meet the new requirements.
For more information or for a no obligation discussion, please email Antony Keen at email@example.com or call 01254 679131.