Do you employ staff? Then you must set up an autoenrolment scheme, even if all of your staff tell you they don’t want to be in your scheme. There are potentially hefty fines starting at £400 and escalating daily if you don’t follow the rules.

1. What’s Your Staging Date?

By law all companies have a “staging date” – which is the date from which eligible employees must be enrolled in a pension scheme. If you don’t know your staging date, go online to

2. What Do You Need To Do?

Your duty as an employer is to set up a scheme which is right for your employees. There are many pension schemes to choose from in theory including the government backed Nest scheme. However many of the private schemes won’t be open to very small companies. Choose a scheme in good time before your staging date. You can set it up online.

You should have a staff meeting before the staging date to explain to employees what autoenrolment means for them.

3. What Happens At Your Staging Date?

All employees (full-time or part-time) between the ages of 22 and state pension age must be automatically enrolled in the scheme, if their earnings are above an annual minimum level and not subject to exemptions. Most other age groups with above minimum earnings will have the right to opt in to the pension scheme. Here’s how to find out more information:

When your staging date is reached you must first autoenrol the eligible employees. Then deduct at least a minimum percentage level of contributions from their pay and make the company contribution at a minimum rate each payday. The total amount must be paid to the pension scheme by 19th of the following month. You should send all employees a letter about the pension scheme at the same time the first payroll is run. Check the link for more details:

4. How Can You Save Time Every Month?

The work of deciding eligibility, producing a letter for the employees about the new scheme, and making regular deductions and calculations of amounts due to the pension scheme can be done by a large range of payroll software. Most payroll software should be able to transmit data direct to the pensions website.

Once you’ve downloaded details of autoenrolled employees to the pensions website, they will be sent a welcome pack from the pension provider explaining how the scheme works. If anyone wants to opt out of the scheme, they notify the pension scheme provider, not you, and if they do that before the next payroll is run, they will get a refund of their contributions the following month (as will the company). You will get an email/letter from your pension provider when an employee wishes to opt out and your payroll software should do all the work for you.

Employees may opt out at any time, but they will only get their contributions back if they opt out in the first month. Once they’ve opted out the company doesn’t have to make any contributions for them either. Those who opt out must be opted in again in 3 years time, but can again opt out yet again if they wish.

5. Still can’t face doing it yourself?

If you don’t want to administer the pension scheme yourself and/or work out the pension contributions each month I can do that for you. Call Frances on 01737 559211 and take a load off your mind!.

If you need some training on payroll or autoenrolment, call Frances on 01737 559211. I specialise in small business tax and accountancy. I can take care of your payroll/autoenrolment for you.

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