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Auto Enrolment

What is it?
Auto Enrolment is HMRC’s name for their new pension scheme sign up process which all employers must have in place for their employees. The date that Auto Enrolment will apply to your business will be known as your staging date.

When does it apply from?
The staging date for the largest employers started on 1st October 2012. The fewer employees an employer has, the later the staging date is. The staging date for employers with less than 30 employees will be 1 June 2015 at the earliest.

Who does it apply to?
If your employees are between 16 and 74 years old and earn more than the NI Lower Earning Limit (Link to rates on our website), they have a right to join the scheme. If they earn more than the personal allowance *(link to our website), you must automatically enrol them into a pension scheme.

 Is there an Opt out?
An employee can opt out after they have been enrolled, but an employer can’t and must enrol any employee who qualifies.

How much will it cost?
Initially, employers must contribute 1% of Gross Pay (actually 0.8% from the employer and 0.2% tax rebate from the government) and employee’s will contribute a further 1%. This will increase to 2% and 3% respectively in October 2017, then 3% and 5% respectively in October 2018.. These are minimum contribtuion rates, employer’s and employee’s may choose to pay more.

What do I need to do now?
Make sure you are prepared for the new scheme by:
1. Reading the details on the following: website http://www.thepensionsregulator.gov.uk/employers/auto-enrolment-and-your-business.aspx
2. Informing your employees
3. Making sure your payroll software/ department can deal with the extra administration etc.

ACE Accounting has a fully managed payroll service and can help you with every step of the auto enrolment process. If you need any help, please contact

John Hill
Tel: 01235 773300
Email: john@ace-accounting.co.uk

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