Many thanks to Employee Benefits for their report:
While a 0.75% cap on the annual charge that pension schemes can apply whilst continuing to meet the qualifying criteria for auto enrolment will come into force in April 2015, there is still widespread uncertainty on whether a business is affected, or how their terms with their provider will change. Worryingly, nearly a third (31%) of businesses have not heard of the charge cap, or have not been informed by their provider or adviser. Close Brothers Asset Management’s latest Business Barometer survey, which questions over 900 employers across the UK, also found that although 30% of businesses with pension schemes were aware of the changes, they were still awaiting revised terms from their provider. A further 33% of businesses said their scheme’s annual management charge (AMC) was already below the cap. Just 6.4% said they were looking at moving to a new scheme as their existing provider intends to apply an additional employer charge. One impact of the cap is that pension providers will shortly cease paying some types of commission to pension advisers, meaning advisers will seek to replace this with fee arrangements. While 42% of businesses with workplace pensions schemes said they will not be affected as their pension adviser already works on a fee basis, nearly a quarter (23%) have not yet been made aware of the issue by their adviser. 1. Do you really know your staging date? The law requires all employers, including small and micros, to provide a workplace pension for certain staff. Each employer has a date by which they need to comply with the law. Our research has shown that up to 40% of micro employers have guessed and got it wrong. Don’t guess what yours is, find out by checking on the regulator’s website using our staging date tool 2. The November deadline to complete declaration of compliance approaches for thousands of medium employers. Employers have five months from their staging date to complete their declaration of compliance (registration). Thousands of medium employers (62- 89 workers) who staged in July and have automatically enrolled their eligible workers need to complete this legal requirement by the end of November. Employers must submit information to the regulator about how they’ve complied with their employer duties. Those who do not do complete their declaration in time could be fined. Do not wait until your deadline to complete this. You can start to complete it now and fill in the remainder when you are ready. 3. The first employers have been issued a Fixed Penalty Notice for not meeting their duties. As we deal with smaller employers, we will see more who, despite our message to prepare early, leave it too late or do not comply at all. Willful non-compliance is not acceptable. We expect to see the number of times we need to use our powers increase. The regulator has a range of powers to tackle non-compliance including serving fixed penalty notices and escalating daily penalties notices. Key messages from The Pensions Regulator 28 November 2014 The Pensions Regulator has issued a helpful note of key auto enrolment messages.
TPR tools:
1. TPR Worker Enrolment and Assessment Tool – We encourage employers to first look at their existing payroll systems to check whether these are suitable for automatic enrolment. If not, there are a number of free or competitively-priced payroll software products that can support the smallest employers with AE. However, we are mindful that there remains a significant risk that those users of HMRC’s Basic PAYE Tool (BPT) tool, who do
CIPP Policy News Journal
08/04/2015, Page 349 of 521
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