Jul 2015
26
TPR revises estimate of number of small and micro employers to be impacted by Auto Enrolment. Estimate increased by half a million!
The Pensions Regulator has revised its estimate of the number of small and micro employers who will need to stage between now and 2018.
TPR figures show that a total of around 1.8 million small and micro employers will stage over the next three years, compared to the previous estimate of 1.3 million.
TPR said that the reason for the revision of the estimate was that more business start-ups had entered the UK market, and that there were lower numbers of business closures than anticipated.
However it should be noted that a large number of micro employers will be one director companies where the director is also the sole employee. These employers are effectively exempt from auto enrolment and can "opt out" by informing TPR.
Jul 2015
25
TPR publishes guidance on pension scheme selection
The Pensions Regulator has recently published guidance for employers and advisors on pension scheme selection for automatic enrolment.
Changes to the law on workplace pensions and the roll out of auto enrolment mean that every employer in the UK has to automatically enrol certain members of staff into a workplace pension scheme.
Small and micro employers have, since 1st June 2015, come into the auto enrolment net (i.e. staged) and the number of these employers "staging" will increase dramatically from January 2016.
The guidance from TPR is a welcome inclusion for those employers/advisors who may wish to research the various pension schemes available for enrolling their employees.
Many small/micro employers will automatically opt for NEST but it is advisable to be aware of the options available. Some employers may choose NEST for one segment of their employees while opting for a more tailored scheme for other employees.
The TPR guidance is available here.
Jul 2015
14
Fit for Work roll out
Fit for Work effectively replaces the old system where an employer could recover
statutory sick pay from HMRC. The new system is far more proactive and the belief
is that it will reduce overall sickness absence.
Fit for Work offers free, expert and impartial work-related health advice to help you
support both staff in work and those who are off sick and also to help you manage
the impact sickness absence can have on your business.
There are two elements to Fit for Work:
• Free, expert and impartial work-related health advice for you, your employees
and GPs via a website (www.fitforwork.org) and telephone line (0800 032 6235)
• Referral to an occupational health professional for employees who have been off
sick, or who are likely to be off sick, for four weeks or more.
The Fit for Work advice service went live at the end of 2014 and from early March
2015, GPs in Sheffield and North Wales began referring eligible patients to a Fit for
Work occupational health assessment. Fit for Work is being expanded across England
and Wales over a period of months with GPs being able to refer nationwide by
autumn 2015.
If you are an employer in an area where GPs can refer, you may start to receive
Return to Work Plans, which offer advice as to how you can work together with
your employees to help them back to work. The Return to Work Plans provide
recommendations and evidence of sickness, replacing the need for a fit note. You
can find out when GPs in your area will be offering the service by visiting
http://support.fitforwork.org/app/get_involved/type/gp.
You’ll be able to refer from autumn 2015, once GP roll-out has been completed.
The intention is that Fit for Work complements, not replaces, existing occupational
health provision. The Government has also introduced tax exemptions of up to £500
on medical treatments recommended by Fit for Work or an employer’s occupational
health service.
Jul 2015
1
CIS - Penalties and Appeals Service goes live
HMRC have announced that the Penalties and Appeals service, for The Construction Industry Scheme, has now gone live.
Details of how to access the service can be found at https://www.gov.uk/what-you-must-do-as-a-cis-contractor/file-your-monthly-returns under the heading, "If you disagree with a penalty".
The scale of penalties for late CIS returns is shown below.
How late the return is and associated penalty:-
1 day late £100
2 months late £200
6 months late £300 or 5% of the CIS deductions on the return, whichever is higher
12 months late £300 or 5% of the CIS deductions on the return, whichever is higher
For returns later than this, you may be given an additional penalty of up to £3,000 or 100% of the CIS deductions on the return, whichever is higher.
You must still file a return for the months when you made no payments to subcontractors (unless you request for your scheme to be made inactive). This is called a ‘nil notification’.
Jun 2015
19
What to do if you are exempt from Auto Enrolment
Automatic enrolment duties don’t apply when a company or individual are not considered an employer. You won’t have any duties if you meet one of the following criteria:
- you’re a sole director company, with no other staff
- your company has a number of directors, none of whom has an employment contract
- your company has a number of directors, only one of whom has an employment contract
- your company has ceased trading
- your company has gone into liquidation
- your company has been dissolved
Before your staging date, you can let the Pensions Regulator know that you are exempt. This will avoid you having to register with a pension scheme and submit a declaration of compliance.
If circumstances change and you no longer meet the above criteria then you need to let the Pensions Regulator know.
More information, including the link for letting the Pensions Regulator know about your exempt status, can be found here.
Jun 2015
18
HMRC penalty notices to employers with fewer than 50 employees
HMRC has now issued the first in-year penalties notices to employers with fewer than 50 employees who missed the deadline for sending PAYE information to HMRC. Please see the News story on GOV.UK at https://www.gov.uk/government/news/pay-as-you-earn-paye-late-filing-penalties for further details.
May 2015
15
BrightPay causes a stir at Accountex
BrightPay attended Accountex this week. Accountex is the UK's national accountancy exhibition and conference.
There was huge interest in our payroll software, mainly due to 2 key selling points:
- Its competitive price point (£199 plus VAT per annum which includes support) and
- Its ability to deal with all aspects of automatic enrolment seamlessly and elegantly.
The one question I kept getting asked was "how can you do it at that price?".
We have been in the payroll software business for 22 years and this has been our business model. We offer affordable payroll software that is intuitive and self explanatory, thereby cutting down on the support requirement. Where support is needed, this is available over the phone, by email or through the many instructional videos and online support channels that we employ. We currently have 12 dedicated support staff catering for 65,000 employers. We constantly review our staffing requirements and take on and train more staff, as and when required.
Try it out for yourself and you will understand. Payroll software does not have to cost an arm and a leg :)
Feb 2015
23
Automatic Enrolment and Postponement
When a company reaches its staging date, it must automatically enrol all eligible employees into a qualifying pension scheme.
If it is not ready to enrol employees at the staging date, it can defer the enrolment of all employees for up to 3 months. This may be because it has not yet registered with a pension scheme or it may be because it doesn't have the necessary systems in place to handle assessments and contributions.
An essential part of postponement is communicating with all employees within 6 weeks of the staging date, letting them know that automatic enrolment has been deferred. If the company fails to issue these communications then postponement will never have happened and auto enrolment must be applied retrospectively to the staging date.
This is important as apparently some employers are interpreting postponement as not having to do anything for a 3 month period!
BrightPay prompts the user to print these letters before proceeding beyond the staging date.
Feb 2015
16
4 tips when setting up your automatic enrolment scheme with NEST
Before your staging date you should register with a qualifying automatic enrolment pension scheme. NEST operates one of these schemes and it will probably be the most popular scheme for small and micro businesses due to two main factors:
a] It is Government backed
b] It has a legal obligation to accept all employers who wish to use it to comply with the duties, irrespective of their size
Registering with NEST is fairly straightforward and should take you no more than half an hour. If you are going for the bog standard setup with the one minimum scheme for all employees, you have no delegates and you have your bank details to hand, the setup time could be as little as 10 minutes!
The four things to note or watch out for during the setup are:
1. Name of payment source. You'll be asked to put a name on the payment source you will be using to pay contributions. You can use any name you like e.g. Bank1. The thing to watch out for here is that when you enter the NEST details into BrightPay that you use the exact same name with the same uppercase and lowercase letters. If you enter "Bank1" in the NEST registration and then enter "bank1" in BrightPay, your csv file submissions will be rejected by NEST. Both names must be identical in all respects.
2. Group name. If you are just applying the one rule for all employees, then you will only have one group. You could call this group "Group1". Again it is vital that you enter the exact same name when entering the details in BrightPay.
3. Pay periods. If you pay your staff monthly, enter the start and end date of your actual pay period and NOT the tax period. BrightPay does not use tax periods for calculating contributions or for worker assessment.
4. Contribution rates and workers' pay. Again, assuming you are going for the bog standard, your contributions rates will be the current minimum and this will be calculated on qualifying earnings. Of course it’s also possible, and just as easy, to pay contributions above the minimum levels should you wish.
If you intend to have someone else look after your automatic enrolment duties e.g your accountant, bookkeeper or payroll bureau provider, you will need their details. NEST provides a checklist of details to obtain before you register with them. This can be found here.
Once you have completed your registration with NEST you should then enter the details in BrightPay. This should take no more than 3 minutes.
BrightPay will start enrolling employees once your staging date arrives (or give you the option to postpone for up to 3 months).
Jan 2015
22
Auto enrolment - DWP research on opt ins and opt outs
DWP research* (January-July 2014 stagers)
•Opt-ins 1%
•Average opt-out rate of 12% in 1st month after staging (range 5 - 15%)
•Ceasing active membership months 2 and 3 - 2%
•Average scheme participation rose from 43% to 73%
•Most likely to opt-out +50 yrs and part-time workers - opt-out reasons:
–lack of affordability (typically £20-£30k earners)
–some other form of saving and/or pension in place (50% of these earned less £30k)
–insufficient time to save enough (typically over 50 yrs)
–not planning to stay with employer and didn’t want small pot
–a few wary of pensions as a savings vehicle.
* 50 employers and 100 workers who ‘opted-out’ were interviewed. PAYE size range 62-499.
(Information source - The Pensions Regulator)
