Micro firms face ‘£22m fines’ over auto-enrolment breaches

It seems that a ‘Sizeable chunk’ of micro employers still not aware of duties regarding auto enrolment.

According to professionaladviser.com, a significant minority of micro employers remain ‘in the dark’ over auto-enrolment responsibilities and face collective fines of £22m for potential breaches, according to a payroll provider.

Data from The Pensions Regulator (TPR), released in its second quarter 2016 auto-enrolment report, said 262,000 micro employers were expected to stage both this year and in 2017. It said levels of understanding among micro employers – which have fewer than four employees – is about 80%.

Payroll provider Paycircle said this means 52,000 of the UK’s very small businesses are potentially open to fines for non-compliance.

It added based on fines handed out by TPR to date – of which a £400 fixed penalty notice was the most common – total collective penalties for micro employers could reach £22m levied this year and next.

Sterling & Law IFA Laurence Sanderson urged small businesses to leave enough time ahead of their staging date to properly prepare for auto-enrolment obligations.

He said: “People are not getting involved early enough. More and more clients are coming to us well after the staging dates. They very much have their head in the sand. This makes it harder to resolve the situation.”

To properly comply with auto-enrolment employers, or their advisers, must complete a declaration of compliance and submit it to TPR.

If it is not completed within five months of their staging dates they could be fined. Sanderson added: “Most fines are coming from this [not] happening.” He also urged accountants and payroll providers to communicate more with their clients ahead of staging dates.

Pay circle co-founder Catherine Pinkney said despite a huge awareness campaign from the regulator a “sizeable chunk of micro employers are still very much in the dark as to what to actually do as their staging date descends on them”.

“Given the no-nonsense approach of the regulator in handing out fines, these businesses need to sit up and take note or risk being slapped with a sizeable penalty,” she added.

by Darius McQuaid – http://www.professionaladviser.com/
Original Article here