MOST small and medium-sized business will have to auto-enrol all their employees into a workplace pension scheme in 2016 or 2017.
According to the Centre for Economics and Business Research, the typical small and medium-sized business will need to spend 103 days undertaking the 15 essential steps for auto-enrolment implementation. If they did this work themselves, this will cost a small and medium-sized business a staggering £10,750 in the typical salary costs of their payroll person.
And the costs don’t end there!
Once a typical small and medium-sized business has got their auto-enrolment scheme up and running, the Centre for Economics and Business Research estimate that the business will need to spend an average of 3.5 man days a month administering their auto-enrolment scheme. Again, in the typical salary costs of their payroll person, this will cost £365 per month.
And it doesn’t end there!
Many pension companies are already warning that there will be severe capacity constraints as they simply do not have the capacity to deal with all of the employers who need to auto-enrol. Most pension companies are advising applying to set up a scheme at least a year in advance of the staging date. Some of the well-known pension scheme providers are already turning employers away if they are not big enough.
With potential fines of £500 a day for not having a pension scheme up and running by the due date, businesses cannot afford to not have an operational scheme in place.
Independent research by NEST shows that over 95 per cent of small businesses will look to their accountants for help and support with their auto-enrolment process, but only 50 per cent of accountants plan to offer an auto-enrolment service.
Here at Harris & Co we’ve invested heavily in setting up the resources to support our clients through auto-enrolment and have been successfully auto enrolling small businesses for the last 12 months.
Contact Harris & Co Chartered Accountants on 01604 600661 or visit the website www.harrisandco.biz