Yet both are of course an essential part of running most small businesses.
Workplace Pensions – what’s happening?
Every three years, employers must also complete re-enrolment which means enrolling all eligible staff who are not currently members of a workplace pension, into a scheme. They must then complete a re-declaration of compliance. This process is called re-enrolment and it must be done for all employees that meet the age and earning criteria. The employer must re-enrol staff who left their pension, or reduced their contributions, back into a scheme that can be used for automatic enrolment, and complete a re-declaration of compliance.
The Pensions Regulator (TPR) has launched an online tool to make it easier for employers to re-enrol their staff into workplace pension schemes. The new re-enrolment tool will assist small and micro employers reach their re-enrolment dates in the coming months.
Find out more about re-enrolment by visiting The Pensions Regulator’s re-enrolment online page. https://www.thepensionsregulator.gov.uk/en/employers/re-enrolment
FSB Workplace Pensions offer a Triennial review service to take away this administrative burden which is available for a one-off fee of £99 +vat*. The Triennial review service is a part of both the Payroll and Pensions Solution and The Premier Pensions Service at no extra cost.
Payroll – what’s happening?
One of the main challenges is that legislation in both areas is constantly changing and therefore it is a confusing and complicated area for all but the professionals involved. You start out thinking, “How difficult is it run a payroll after all, simply pay your staff with a deduction for tax and National Insurance (NI)”, easy. But then reality kicks in.
Apart from Income Tax and NI there’s a need to know about, and implement changes in many other areas: Real Time Information (RTI), RTI penalties, Statutory pay and leave, SSP rates, statutory parental bereavement leave and pay, Student Loan Deduction thresholds, Court Orders and other attachment orders, Apprenticeship Levy rates and allowances, Expenses and benefits, Voluntary payrolling of benefits, Company car benefit figures, Diesel supplement changes, Van and fuel benefits, Tax-Free Childcare, Pension Annual and lifetime allowances, Automatic enrolment, ongoing duties and re-enrolment. And that really is a very shortened list.
Every new year brings change, but 2019 will be a very busy year for those trying to run payrolls. There are several important regulatory changes that have taken place in 2019 that will have lasting impacts on employer payroll.
Payslip Changes: Employers now have to provide the number of hours worked on each employee payslip (that began on 6 April 2019). This helps to ensure employees understand the exact hours they are being paid for in each pay period, and will hold employers liable to ensure they are accurately paying their employees.
Auto-Enrolment: Contributions levels increased beginning 6 April 2019. The phased increases brought employer contributions up to 3% and employees up to 5%.
Welsh Taxation: With the introduction of the Scottish tax in 2017, taxes across the UK have become more complicated. In April 2019, the new addition of Welsh Tax Rates complicate matters further. UK employers will now have to manage three different taxation rates covering England/Northern Ireland, Scotland, and Wales. The basic tax rate for now is the same across all countries in the UK. If the basic rate does not remain consistent going forward, pensions will become more difficult to manage across the UK. Stay tuned for more changes coming after the implementation of the new Welsh tax rate in 2019.
Student Loan Changes: Thresholds for repayment of student loans have changed. If you have employees with student loans, payroll and payslips must be accurate and show the deductions.
Dynamic Tax Codes: HMRC dynamic tax codes continue to create challenges for employers. Using estimated pay to determine tax codes causes issues when bonuses are paid early or mid-year, increasing the estimated amount of tax owed by the employee. HMRC has implemented dynamic codes which allow for in-year adjustments, so corrections are made in the same year. These dynamic tax codes continue to cause problems for implementing payroll, increasing the potential for non-compliance.
This coming year will present challenges to effectively manage payroll in the UK. If you’re struggling to maintain compliance, or need support, we can help. Contact us for further details and see how easy, and cost-effective payroll can be with our state of the art technology and a dedicated service team.
As we said at the start, no one really enjoys even thinking about payroll or pensions, let alone actually completing pay runs, self-assessments, pension contributions and other business returns. It can be a complex process which usually isn’t your area of expertise so why not unload some of this onto an FSB service provider. That’s what they are here for, one of the key benefits of being an FSB member, let them take the strain.
FSB Workplace Pensions offer a service which will accurately calculate pension contributions as just another part of payroll, using deceptively simple payroll software which fully incorporates workplace pension calculations, at no additional cost. It creates accurate records of contributions made, documentation issued and provides prompts when employee circumstances change. This system, and the dedicated support team (it’s a service, not just software), will ensure you don’t become another statistic for HMRC or The Pensions Regulator.
The fees for the Pensions and Payroll solution are just £5 +vat per pay-slip, including all Workplace Pensions calculations and paperwork. A monthly paid workforce of four would cost just £20 +vat to administer, both payroll and pensions, a much lower cost than having an administrator in the office.
Happy with your current payroll provider? No problem. FSB Workplace Pensions offer their Premier Pension Service which provides ongoing management of your Workplace pension (£12.50 +vat p.m., up to 10 employees).
Their Auto-Enrolment Triennial review service is also available for a one-off fee of £99 +vat*. The Triennial review service is a part of both the Payroll and Pensions Solution and The Premier Pensions Service at no extra cost.
So let us the take over the boring bits and you can return to being the life and soul of that dinner party or night out at the pub.
*For up to 10 employees.