Ignore the costs of auto enrolment at your peril!

Like it or not auto enrolment will affect all employers. For some this will not be until 2015 or beyond but larger employers will have been caught up from October of last year.

The staging date, which is the date that you as an employer has to comply with auto enrolment, is determined by the number of employees in your PAYE scheme as at 01 April 2012. For most UK employers (employing between 61 and 249 employees) their staging date will fall between 1 April 2014 and 1 August 2014.

This may seem some time off but deferring your planning for auto enrolment could prove costly. Whether employers choose to phase their pension contributions to reach the total contribution requirement at October 2018 or comply with the total contribution requirement from their staging date, there will be an additional employment cost that will have to be budgeted for.

Planning for the additional costs now will:

• enable employers to factor these additional costs into their annual pay reviews.
• look at the differing employee and payroll profile of each department around the organisation and determine which contribution option best fits. One size doesn’t have to fit all and often tailoring contribution rates to different departments in the organisation can reduce the financial burden of auto enrolment.

Cullen Financial Planning Limited can work with you to plan ahead for auto enrolment, identifying the issues specific to your company and ensure their resolution.For more information on Pension Reform or other Financial Planning issues please contact Karen Robinson (karenrobinson@cullenfp.co.uk).