HMRC's Basic PAYE Tools (BPT) users & Auto Enrolment - Facing your Fear

HMRC's BPT users may be unprepared for auto enrolment as HMRC's payroll tool is basic and cumbersome. Not only is the tool cumbersome - it does not produce payslips leaving the employee without full visibility to payroll and pension deductions.

The Pension Regulator (TPR) recently consulted payroll industry experts, payroll software companies and users of Basic PAYE Tools to see how these users would face their automatic enrolment journey. TPR's consultation examined the current issues of automatic enrolment as well as the lack of functionality for BPT customers to successfully process the employer duties. Basic PAYE Tools lacks automation and functionality to process AE employer duties.

After the consultation The Pensions Regulator concluded that they will provide an Auto Enrolment toolkit for BPT users, but confirmed the tool will be primitive and manual.

Without payroll software tools that cater for auto enrolment duties, users of the TPR's AE toolkit will be in danger of miscalculating contributions. There is also an inherent risk of incorrectly assessing employees who might otherwise be eligible jobholders.

A high proportion of BPT users have said that they will avoid free or low cost commercial software as they are afraid to change. It is natural for these employers to be afraid but they should be aware that they will face penalties and fines if they process automatic enrolment incorrectly. TPR's consultation report explains;

"Current users stated they would be unlikely to stop using the BPT due to a mix of inertia, brand loyalty and the burden associated with switching to an alternative payroll product with built-in automatic enrolment support."

If these users continue to use HMRC’s Basic PAYE Tools, it will leave them with the limited option of the TPR's AE toolkit. TPR also recognises that existing free and paid payroll software is available on the market offering auto enrolment functionality.

The Regulator concluded that BPT users have three options;

• Utilise existing free or low cost commercial software to comply with auto enrolment.
• Use third party (non payroll) providers such as pension providers that offers assessment.
• Use TPR's AE toolkit.

The Regulator continues to recommend that BPT users avail of existing payroll solutions on the market explaining;

"Our tool will mitigate the risk, while being basic enough to not discourage employers from using commercial payroll products."

If TPR's AE toolkit is used, users will need to ensure everything is accurate in line with automatic enrolment, employers will need manually double and triple check all their calculations. Even then, simple errors may have occurred. These errors will also take time to locate and fix.

If BPT users want their information to be correct, they should face their fear and utilise payroll software that is available on the market. If BPT users also want their automatic enrolment process to be streamlined and easy they will need to choose payroll software that can automate the employer duties for them.

BrightPay helps BPT users comply with Automatic Enrolment

An important factor for HMRC customers is time. BPT users are concerned that migrating to another payroll tool will be difficult and time consuming. BrightPay has made this step easy. We have developed a free and easy import feature from HMRC's Basic PAYE Tools into BrightPay, a task which takes less than one minute to complete.

This HMRC specific import tool allows users of Basic PAYE Tools to export their employee data file and import directly into BrightPay. The import facility has been specially designed to recognise information such as company and employee details and cumulative payroll data. Once the import has been completed, users will then be able to open their company file and immediately start processing payroll.

BrightPay offers a free licence for employers with up to three employees. Our standard employer licence is just £89 + VAT / tax year which includes unlimited employees. All of BrightPay's licences have free auto enrolment functionality plus free phone and email support. You can try before you buy too. BrightPay's free 60 day trial offers full functionality and we won't ask you for any credit card details.

Related articles:

• HMRC Basic PAYE Tools users to get Automatic Enrolment tool from TPR
• HMRC users & Auto Enrolment: Manual vs. Automation
• 10 key reasons to move from HMRC Basic PAYE Tools to BrightPay
• TPR introduce Auto Enrolment Toolkit for Basic PAYE Tools users
• How useful will The Pensions Regulator Auto Enrolment Toolkit be?
• Limitations of the AE Toolkit for HMRC Basic PAYE Tools users

Posted byKaren BennettinAuto Enrolment