With Auto Enrolment (AE) fast becoming a reality for many accountants’ clients, we asked our good friends at BrightPay to give us their views on how accountants can support their clients through the AE process, and in turn develop new fee-income streams.
At the end of March 2016, more than 6.1 million employees had been successfully enrolled into a workplace pension scheme. An impressive 110,000 employers have been through the auto enrolment process with high levels of compliance and more than 95% of employers, who had AE duties, have complied with the law.
In the coming months there are tens of thousands of small and micro employers yet to stage. A key question accountants therefore need to ask themselves is, are they willing to help their clients with their administrative auto enrolment duties?
These smaller employers will certainly be the least prepared for AE and are at a higher risk of non-compliance. They typically have less knowledge of pensions, auto enrolment and even the Pensions Regulator.
This year between 431k – 459k employers are expected to stage. Of those, 37% have 1-2 workers, 19% have 3-4 workers, 21% have 5-9 workers and 21% have 10-49 workers. This clearly represents a unique opportunity for accountants to help their clients and increase revenue at the same time.
Making auto enrolment a chargeable service
There’s little doubt that small and micro employers will look to their accountant to help them with the AE process. Employers, or their accountant, will need to undertake a number of auto enrolment administration duties including employee assessment, sending letters to all employees, enrolling eligible employees, processing opt in and opt out requests, sending pension files to pension providers and much more.
Accountants can help their clients by offering auto enrolment as a chargeable service. It is the legal responsibility for the employer to comply with their AE duties, but many will be glad of an accountant’s help. It will be important though that you clearly define what AE duties you will be offering as a service.
Make sure you communicate to your clients about how AE will affect them. A good starting point would be to send them a report giving an overview of what AE will look like at the time of staging including details of employees’ pensionable pay, qualifying earnings, contribution figures and employees worker categories. See an example here.
How to access the relevant information
Your payroll software should easily produce this report in advance of staging. Many of the functions required for AE are process driven by software. Using existing payroll software tools, accountants should be able to automate and handle their clients administrative AE tasks easily. Auto enrolment is the perfect platform to increase your service offering and increase your profits.
Written by Karen Bennett, BrightPay payroll software.
A special offer for BTCSoftware clients
BTCSoftware clients can now claim a 25% discount off their first year’s payroll software subscription, when they switch to BrightPay. To take up this offer, you can purchase online or contact the BrightPay sales team on 0845 3004 304 or sales@brightpay.co.uk and quote ‘25% Discount Sale’. Please note the offer only applies to new bureau customers who switch from a different payroll software provider and is for the first year’s subscription only. Applies to BrightPay 16/17 bureau licences only and offer ends 4 April 2017.
