The duty date is the date by which you need to have a workplace pension scheme in place. If you miss the deadline and fail to put things right The Pensions Regulator can issue fines that can run into the thousands.
If you’re a client of Biznus Payroll then we’ll guide you through the process of auto-enrolment so that you don’t miss any key deadlines. But for those of you going it alone here are some tips on what to do if you miss your duty date.
- If you find out you’ve missed your duty date then you must act quickly. The problem won’t go away and will only get worse the longer you leave it.
- If you find out you’ve missed your duty date within six weeks of the date your first employee starts, you can postpone auto-enrolment. But to be compliant you must write to your staff within six weeks to tell them you’re postponing auto-enrolment and what that means.
- If you don’t write to your staff then you won’t be able to postpone and potentially liable for a fine.
- If you’re outside the six-week period then you must get in touch with The Pensions Regulator as soon as you realise your mistake. The Regulator treats each case differently and if you can show that you have a good reason for missing your deadline and that you’re willing to put things right, then you may not get a fine. The Pension Regulator states: “You should aim to put all staff back in the position they would have been in if you had complied on time.”
- You will need to choose and set up a pension scheme and assess your employees. You’ll need to find a pension scheme that you can set up after your duty date as not all pension providers will allow this.
- Eligible employees should be enrolled and contributions backdated to your duty date. You can request that your employees backdate their own contributions as well, currently at 5% (4% after tax relief), but they don’t have to do this and you can choose to cover the full statutory minimum contributions yourself, currently set at 8%, up to the last pay period.
If you don’t make amends and continue to ignore letters from TPR the fines will be stiff. Fines range from £50 to £500 a day if you fail to comply with workplace pension legislation and don’t take steps to put things right.
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