It’s not beyond the stretch of the imagination to suggest most micro-business owners probably don’t have first-hand experience of managing pension schemes.
With auto-enrolment now compulsory for all but a few businesses, it is imperative business owners of all sizes get to grips with their new obligations.
If you’re the owner of a micro business that has not yet had its staging date, this post will answer 2 essential questions related to auto-enrolment…
When do my auto-enrolment duties begin?
From October 2017, all businesses recruiting for the first time will have to begin complying with auto-enrolment legislation from the day an employee starts work.
However, the picture is a little more complex if you recruited your first employee between 2 April 2017 and 30 September 2017 as your staging date will depend on when you set up your PAYE scheme.
Setting up a PAYE scheme before your employees began work:
- 1 January 2018 (if you paid your staff for the first time between 2 April 2017 and 30 June 2017)
- 1 February 2018 (if you paid your staff for the first time between 1 July 2017 and 30 September 2017).
If you set up a PAYE scheme after your employees begin work, your duties will commence on the day your first employee began working for you.
What are the costs of auto-enrolment?
Several factors determine how much auto-enrolment will end up costing your business, including which pension scheme you use, how your payroll is operated and how many employees you take on.
The costs of payroll will depend on whether you manage it yourself or you pay professionals to administer it for you.
Most pension schemes will ask for monthly payments in addition to the initial costs of setting up the scheme. However, some schemes targeted specifically at small businesses will not charge.
It’s important to thoroughly research your options and make sure you understand the costs before deciding on a scheme.
You currently have to contribute a minimum 1% of the employee’s annual salary into the pension scheme, although this will rise to 3% by 6 April 2019.
How we can help
Setting up a workplace pension scheme may seem intimidating for very small businesses; operations that probably don’t have much in the way of time or resources to dedicate towards administering a pension scheme.
This is where we come in. By outsourcing your payroll to us, we’ll do more than ensure you’re complying with auto-enrolment legislation.
We’ll handle everything from tax and employee benefits to maintaining your records and setting up new employees on your PAYE system.
Contact us on firstname.lastname@example.org or call 01628 631 056 to find out about our auto-enrolment services.