Are you prepared for auto enrolment? · advance SMEs begin to prepare for auto enrolment, and what help and advice they sought when getting ready. We’ve included the four key questions

Are you prepared for auto enrolment?Part two

We spoke with 303 small business around the UK to see how prepared they were for auto enrolment. Find out what feedback we got and what our top tips are for your business.

Call 0844 815 5656, or visit iris.co.uk to see how we can help you

Introduction & Aims

This is part two in our three-part series during which we’ll look at the awareness of auto enrolment amongst accountancy firms and small & medium-sized businesses (SMEs).

We asked 303 SMEs from across the UK 10 questions about auto enrolment in order to gain an insight into how aware and prepared they were for the change in legislation. We wanted to know how far in advance SMEs begin to prepare for auto enrolment, and what help and advice they sought when getting ready.

We’ve included the four key questions from the research in this paper.

Aims

Identify how ready SMEs are for their auto enrolment staging date

How much knowledge SMEs have around auto enrolment and the

legislation

Find out if SMEs have been looking for advice and help around

auto enrolment

Identify the level of satisfaction around any help received in

relation to auto enrolment by SMEs

Ensure IRIS helps SMEs by providing suitable auto enrolment

training solutions


Q1: Yes or No: auto enrolment is optional?

Previous research has shown that the awareness of auto enrolment stands around 88%. Our research shows an awareness of responsibilities of 93% which is great to hear.

The Pensions Regulator estimates that around 570,000 small and medium-sized businesses will be staging for auto enrolment between April 2016 and April 2017, so the more businesses who are up to speed with the legislation the better.

6% or just under 20 of the 303 businesses who took part in the research believe that changes to the workplace pension are optional; they are misunderstanding that auto enrolment mandatory and all UK businesses must make the change if their employees are eligible.

We recommend that if you are unsure what to do, you visit The Pensions Regulator website to read-up on auto enrolment legislation and find our your staging date to avoid non-compliance; as this can lead to fines and even court action.

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Q2: When do you expect to start preparing for auto enrolment?

We asked this question to check how in-line with The Pensions Regulator’s advice businesses actually are. The Pensions Regulator and IRIS advise businesses to begin preparing for auto enrolment at least 12 months in advance.

63% of businesses explained that they will begin preparing 12 months before their staging date, but the 37% who are going to prepare later may not be leaving themselves enough time.

Beginning your auto enrolment journey 12 months in advance gives your business some breathing room to get everything prepared in time. It is concerning that 37% of businesses plan to begin preparations so late as this may mean they miss their staging date.

Our top tip here is to not ignore the workplace pension and give your business enough time to prepare. By preparing in enough time, you’re giving your business a chance to iron out any potential problems so that when you reach your staging date, everything runs smoothly.

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Q3: Which statement best describes your intended auto enrolment solution?

This question brought back one of the most surprising results. 32% of businesses plan to manually manage auto enrolment for their business, and this suggests that businesses perhaps are not fully aware of the level of work needed to manage auto enrolment manually. If businesses are not fully up-to-speed with auto enrolment, and plan to manage it manually, it’s very likely that this could cause problems with maintaining compliance down the line.

Using software such as the IRIS AE Suite™ is recommended as all of the calculations are done for you, and the correct monthly contributions for each employee are calculated automatically. Additionally, the software helps your business remain compliant with The Pensions Regulator requirements by maintaining an audit trail of communications.

It’s great that so many of the respondents plan to use the industry’s leading auto enrolment solution, the IRIS AE Suite ™, and additionally 5% plan to outsource their auto enrolment responsibilities, which is also something IRIS can offer businesses.

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http://www.iris.co.uk/cloud-solution/iris-openenrol-and-automatic-enrolment-module/



Q4: Are you satisfied with the help that IRIS has given you to prepare for auto enrolment?

Helping make auto enrolment as easy as possible for small and medium-sized businesses like yours is a main priority here at IRIS. We can help businesses along any stage of their auto enrolment journey.

We hold regular webinars which are free to attend, we write daily blog articles and regular guides similar to this one, and we’re more than happy to have a chat over the phone.

The feedback to the question above, asking businesses how happy they were with the help IRIS gives them shows how passionate we are about payroll and helping businesses.

We recognise that nearly 30% of the feedback explained that they were happy with help from IRIS, the majority of this is from people not contacting IRIS or the other way around. We only make initial contact with businesses who are 12 months away from their staging date, and have also added the popular “Bite-size AE Webinar” to our webinar range. The Bite-size AE Webinar’s run regularly throughout the month, and are set at 30 minutes long to be has helpful as possible, quickly and easily. Visit our Webinar Page to see when the next sessions are running.

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http://www.iris.co.uk/insight/webinars/

http://www.iris.co.uk/insight/webinars/


Conclusions

• Businesses continue to have a high understanding of auto enrolment

• Over 63% of small businesses are preparing for auto enrolment 12 months or more before their staging date; which suggests that 37% of businesses are not giving themselves enough time to prepare

• Businesses who realise they are not up-to-speed with the legislation changes are willing to take part in training on legislation, auto enrolment, and software to help them better understand what is required of them

• There is a risk that due to the high amount of businesses due to stage between now and 2018, that they could get caught up in the ‘capacity crunch’

• There are a high amount of businesses with neither an accountant or financial/business advisor. Whilst this fine, businesses should be seeking advice regarding auto enrolment

• After staging, the awareness of what is next needed seems to be high. Businesses must send a Declaration of Compliance to The Pensions Regulator, and also send the four legally required letters to each employee

• Over 32% of businesses stated they plan to manage auto enrolment manually. This suggests that a lack of awareness regarding the scope and scale about just how big a task maintaining auto enrolment compliance will be. The Pensions Regulator recommend businesses use payroll software.

What does this mean for your business?


TPR estimate that there will be around 570,000 SMEs staging for auto enrolment in the 12 months from April 2016 and April 2017 out of the 5.4 million SMEs registered in the UK.

It’s important that all business owners and managers are aware that auto enrolment is mandatory – your business must comply with the legislation to avoid fines and/or court action.

TPR recommend that businesses who currently run their payroll manually or may be planning to deal with auto enrolment manually, understand the complexities of ensuring compliance with the workplace pension reforms. The research shows that over 32% of respondents are planning on managing auto enrolment manually, which would be extremely difficult. Make things much easier for yourself and save an average of a days’ worth of work each month by joining the 57% of businesses surveyed who said they were planning on using the IRIS AE Suite™.

If you are now less than 12 months to your staging date and are unsure what to do, speak to us, your accountant, or your financial advisor and get up to speed on the changing legislation and what it means for your business. Don’t leave it too late.


Our top 5 recommendations to help your business prepare for auto enrolment


1. Prepare 12 months before your staging date

If you’re part of the 37% of business who plan to begin preparations for auto enrolment less than 12 months before your staging date, you’re lining yourself up for potential problems and ultimately, non-compliance.

2. Ensure that your payroll is correctly set-up to handle the new calculations or outsource to a fully managed payroll and auto enrolment service

Here you have two options; speak to your payroll software provider and make sure that your system is correctly set-up before your staging date, and then correct any issues which may appear. Or, you can outsource your entire payroll and auto enrolment responsibilities to a fully managed outsourcing service.

3. Undertake test runs of your payroll including auto enrolment

Conduct test runs of your payroll including the auto enrolment contributions for your staff, to identify any problems early on.

4. Find the right pension provider for your business

Certain pension providers offer different benefits and privileges to members, others will no longer accept new members. There are numerous pension providers operating in the UK, know what you want from your pension scheme and speak to them to see what they can offer.

5. Don’t ignore auto enrolment

Last but certainly not least, don’t ignore the workplace pension! Auto enrolment is mandatory for all UK businesses. Non-compliance can lead to on-the-spot fines, daily charges, and even court action; get your business prepared early on and avoid penalties.

The IRIS AE Suite™


The Pensions Regulator recommends that employers use payroll software that caters for their auto enrolment duties.

The easiest way to help ensure compliance with auto enrolment is by making sure that your payroll software is capable of handling the various calculations and deductions each pay period.

By having the right software in place your business can streamline auto enrolment to a fully automatic process.

The right software can save time, help ensure compliance and avoid fines, and also manage the communication aspect of auto enrolment to assist with audits.

IRIS are proud to offer the industry’s leading auto enrolment solution, the IRIS AE Suite™.

Developed through close relationships with both pensions providers and The Pensions Regulator, as well as customer feedback, the solution works within your payroll to perform the calculations for each pay period automatically.

Additionally, the package automatically creates an audit trail of documentation, and even prepares emails to The Pensions Regulator on your behalf, so all you need to do is check over them and click send to help ensure compliance.


IRIS Managed Payroll Service


Businesses can outsource their whole payroll function or enjoybespoke tailored service from an external provider that allows acompany to focus on their own expertise. Outsourcing payroll has become an option that many organisations are looking at after the introduction of RTI and automatic enrolment.

5 reasons why you should consider outsourcing your payroll:

1. Minimise your auto enrolment stress

2. Save time

3. Reduce your costs

4. Utilise the expertise of experienced payroll professionals

5. Improve efficiency

IRIS has specialised in payroll for over 30 years and this experience means we fully understand all aspects of payroll to be able to offer you a first class service ensuring you are legislatively compliant whilst paying staff accurately and on time. We use our own, market leading, HMRC-accredited payroll software which easily enables us to tailor your payrolls to your individual requirements.

Find out how much payroll outsourcing could save your business by using our free Payroll Outsourcing Calculator.

The introduction of both RTI and auto enrolment have brought with them some of the biggest shake-ups in the payroll sector for decades. Protect your business by outsourcing all responsibility to IRIS’ own BACS-accredited outsourcing option, the IRIS Managed Payroll Service today.

http://www.iris.co.uk/insight/iris-rti-managed-payroll-service/

http://www.iris.co.uk/insight/iris-rti-managed-payroll-service/


About IRIS

With over 35 years' experience, IRIS provides business critical software and services to the UK SME sector and accountants in practice. Over 90,000 small and medium-sized companies including 18,000 accountancy practices rely on IRIS every day to run their business and collaborate, with around 547,000 end-users subscribing to IRIS cloud solutions.

IRIS Software Group is the number one solution provider for RTI and its software pays 14 percent of UK businesses that operate under PAYE. All customers receive the greatest choice of RTI payroll software and services managed under the brands IRIS, Earnie and KashFlow.

IRIS is renowned for ensuring that all software and services are completely up to date with the latest legislation which means that you in turn as a customer are also kept compliant. We have shown this with the rolling out of RTI and also automatic enrolment.

To see how IRIS can help your business thrive in 2016, get in touch today.

Call us: 0844 815 5656 – Small businesses owners, payroll & HR professionals

Visit us: iris.co.uk

Follow us on Twitter: @IRISPayroll

We host regular online webinars which cover a wide range of topics, including auto enrolment, holiday pay, taxation and a number of IRIS software packages.

The sessions are free, and are conveniently held online, with no downloads or installations onto your computer or laptop.

To see what webinars we’re running next, visit www.iris.co.uk/webinars

Documents

Are you prepared for auto enrolment? · advance SMEs begin to prepare for auto enrolment, and what help and advice they sought when getting ready. We’ve included the four key questions