14 C
Lancashire
Monday, June 17, 2024

Auto enrolment is here and some small businesses are realising this the hard way

Accrington-based chartered accountants are seeing a flurry of small businesses incurring large fines for not complying in time with their designated staging date.

The main issues are predominantly around the failure of employers attending to the initial auto enrolment process correctly. We haven’t seen this problem during the implementation period for larger business as they have the resources to deal with the process before their staging date.

The Pensions Regulator has the power to issue a statutory notice which compels an employer to put right any omission. Failure to comply with this notice leads to an initial fixed penalty of £400. If the failure continues, the Pensions Regulator has the power to levy a daily penalty varying between £50 to £10,000 per day, depending on the number of employees.

We are now seeing penalties being imposed on small employers and so far we have found the Pensions Regulator to be unsympathetic to any appeal against the size of the penalty.
The lesson is clear.

All businesses, no matter the size, must comply and if they do not they will be challenged by the Pensions Regulator. If left for even a small period of time, these charges can become quite large.

My recommendation is for small businesses owners to seek help from their accountant as soon as possible. Whatever fee your accountant charges for this help will likely be outweighed by the peace of mind you gain knowing penalty charges are not mounting up.

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