Accountants, Auto Enrolment Staging Date Breaches Are Rising
BLOG | Figures released by The Pensions Regulator have shown a sharp rise in the number of small businesses missing their auto enrolment staging date
Auto Enrolment Non-compliance
The number of small businesses missing their auto enrolment staging dates have risen during 2016, according to The Pensions Regulator’s (TPR) latest quarterly compliance bulletin. It releaved that there have now been 806 £400 fixed penalty notices handed out to non-complying businesses, bringing the total since auto enrolment began in 2012 to 2,234.
The bulletin also shows 96 escalating penalty notices (EPNs) have now been issued in 2016, bringing the total issued since 2012 to 127. An EPN is one of the statutory powers TPR has to help Workplace Pension Reform compliance. The amount that the business is fined rises daily and is based on the number of employees the business has working for it. The minimum EPN fine is £50 for businesses with up to four employees, it then rises to £500 if you employ five to 49 people, and can rise to £10,000 per day for larger companies.
Charles Counsell TPR’s Executive Director for Auto Enrolment, said: “Most employers comply on time and we continue to see compliance rates in the high nineties. Others need a nudge and are prompted to meet their duties when one of our notices comes through their letterbox.
“It’s simply not fair for staff not to receive the pension contributions they are legally due. But failing to act also means an employer risks clocking up a significant penalty until they put things right.
“Our message remains that if things aren’t going well, then talk to us; don’t ignore us.”
The Pensions Regulator’s Powers
TPR has the following powers in cases of auto enrolment pension non-compliance:
- Compliance notices to bring attention to the fact a business is in danger of missing their staging date
- An on-the-spot fine of £400
- A daily EPN of between £50 and £10,000 for each day of non-compliance
- Court action in severe cases and the power to issue Warrants
What Your Accounting Practice Can Do
With the number of businesses not complying with automatic pension enrolment, it’s critical that your practice sees the reforms as an important part of your business strategy. We’ve already reported in the past that small businesses are paying on average £440 for pensions advice, and with an estimated 1.8 million small companies due to reach their staging date between April 2016 and April 2018, making auto enrolment part of your strategy really could pay off.
Download our free Auto Enrolment Accountancy Kitbag to gain access to a huge range of content we’ve put together to help make the reforms a key part of your firm’s vision. From free guides, pre-recorded webinars, exclusive content from TPR, letter templates and more, everything can be shared with clients and help you drive home the compliance message to your clients.
You can download the free Kitbag using the button below.