An increasing number of SMEs are being penalised for failing to comply with pension auto-enrolment.
Auto-enrolment requires businesses to enrol all members of staff over the age of 22 and earning over £10,000 pa on to a pension (unless they choose to opt out). If these measures are not put in place by employers, they could face legal action from The Pensions Regulator.
Penalties on The Rise
During the 2015-16 tax year, the Pensions Regulator had around 2,500 whistleblowing reports submitted to them and launched over 8,800 enforcement actions, up from 1,947 in the previous tax year. The number of penalty notices being issued to small businesses is rising, with fines being handed to those that break the rules. Employers with four or less staff are fined £50 a day for every day they fail to comply after being issued a notice, and businesses with five to forty nine members of staff are fined £500 a day. Larger employers could face fines of up to £10,000 per day.
Employees have a right to a pension by law, and if businesses are not providing their staff with the option, serious penalties could be incurred. We can help you plan, understand and arrange pensions for you and your employees which fulfil legal obligations as well as suiting yours and your employees' needs. Please get in touch if you would like more information.