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Auto enrolment Director only - Declaration needed?

Pension Regulator Declaration of Compliance still required?

If you have a Director only payroll and you inform the Pension Regulator of this fact, using their email template, then do you still need to file a Declaration of Compliance with the Pension Regulator.

Am unable to find answer on PR's website.

TIA

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By Locutus
01st Aug 2017 21:07

If The Pensions Regulator responds to your e-mail that it is "not an employer for the purposes of automatic enrolment" then it is not necessary to later complete the Declaration of Compliance.

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to mr. mischief
02nd Aug 2017 16:04

I agree.

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By Matrix
02nd Aug 2017 09:04

Is everyone just completing these for their one Director payrolls or asking clients first or charging a flat fee?

I sent an email to my clients with 1 July stating dates but no one replied so do I do nothing or do it for free? From experience no one has a copy of their letter reference, I could look it up and complete above link but, again do I offer it as a service or do it for free? What are others doing?

To add that I may just include a buffer in my payroll fee for this.

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02nd Aug 2017 09:29

Yes you do.

It's a five minute job.

To answer Matrix, I'm not doing it for free but I won't be issuing a separate invoice for this.

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By RedFive
02nd Aug 2017 09:45

Lion, yes you do........ what?

To clarify the OP question - if you have advised TPR the client is not an employer for AE and received email confirmation then NO need to complete Declaration of Compliance - as in first answer from Locutus.

I'm not charging for advising TPR, it's a 2 minute job even without letter reference and I completed them for my relevant clients with an advice that it was done rather than a question.

I do charge if setting scheme up and completing Dec of Comp by increasing my monthly fixed fee to account for extra payroll task.

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to RedFive
02nd Aug 2017 11:31

RedFive wrote:

Lion, yes you do........ what?

To clarify the OP question - if you have advised TPR the client is not an employer for AE and received email confirmation then NO need to complete Declaration of Compliance - as in first answer from Locutus.

I'm not charging for advising TPR, it's a 2 minute job even without letter reference and I completed them for my relevant clients with an advice that it was done rather than a question.

I do charge if setting scheme up and completing Dec of Comp by increasing my monthly fixed fee to account for extra payroll task.

Yes you do ..... need to submit a Declaration of Compliance, imho.

Even if you've completed the exchange of emails, I don't trust the system to refrain from sending out a penalty notice in five months time. Better a few minutes now than a few hours in January.

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By RedFive
to lionofludesch
02nd Aug 2017 12:01

Thanks for your reply.

Interesting. I did my first email 'opt out' on 12th May 2015, and further ones in July 2015, October 2015 through to many more in March this year via the TPR website.

I haven't completed Dec of Comps for any of them and not had any recourse.

While I honour, understand and bow to your lack of trust in the system I think it's maybe time to revisit this policy?

The email confirmation states "This email is to confirm we have updated our records to reflect that you're not an employer at this time. Under the Pensions Act 2008, automatic enrolment duties no longer apply to you. "

They would have a hard time arguing you hadn't done something after stating you don't have to do anything further.

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to RedFive
02nd Aug 2017 18:21

Well, if I had such an email, you're right, I may do as you say.

However, I don't, and I'm not convinced that this is an easier route to compliance than filling in the Declaration of Compliance.

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By RedFive
to lionofludesch
02nd Aug 2017 12:04

Duplicated

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By Matrix
02nd Aug 2017 10:02

Yes I charge for setting up schemes and have separate engagement letters. I worded the emails to clients with July staging dates as such that the responsibility for dealing with TPR is theirs but we can assist for a fee.

While it may be a 2 minute job (compounded since we all probably do lots of 1 Director payrolls for small fees and I do not generally send top up bills to these clients as all fixed fees), what happens if you miss one and they get a huge penalty? Why would take on this extra responsibility for no fee?

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By Locutus
to Matrix
02nd Aug 2017 10:16

Matrix wrote:

Yes I charge for setting up schemes and have separate engagement letters. I worded the emails to clients with July staging dates as such that the responsibility for dealing with TPR is theirs but we can assist for a fee.

While it may be a 2 minute job (compounded since we all probably do lots of 1 Director payrolls for small fees and I do not generally send top up bills to these clients as all fixed fees), what happens if you miss one and they get a huge penalty? Why would take on this extra responsibility for no fee?

The trouble with AE is that most clients don't understand it and assume it only applies to bigger businesses.

I just automatically opt out all director-only payrolls and build the extra 2 minutes for each into my charging structure.

If you leave it for the directors to do themselves then you can guarantee that 80%+ for various reasons won't and you will start getting angry calls from clients 5 months after their staging date asking why they have been fined £400.

If nothing else, taking each of those angry calls will take up more than 2 minutes of your time. Why not just avoid that now, whilst you still have time?

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By Matrix
to Locutus
02nd Aug 2017 10:26

Thanks I will email them all again since I don't want this to come back to me. I agree that they nothing about AE, not one has sent me the letter reference, but just because I have inadvertently become an expert does not mean they should get it for free. Anyway you have said you are charging so how are you building this into fixed fees?

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to Matrix
02nd Aug 2017 11:54

We write to our clients - saying what needs to be done by when. We state that we will charge £xx to do this on their behave if they contact us and ask us to do it. We state that if they do not positively respond to the letter that we will assume that they are dealing with it themselves and we take no responsibility in connection with it. Our letters have a form to return agreeing what is happening i.e. they want us to do it at a cost of £xx or confirmation that they will be doing it. Obviously we do ring the clients who have not responded.

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By Locutus
to Matrix
02nd Aug 2017 12:33

Matrix wrote:

Thanks I will email them all again since I don't want this to come back to me. I agree that they nothing about AE, not one has sent me the letter reference, but just because I have inadvertently become an expert does not mean they should get it for free. Anyway you have said you are charging so how are you building this into fixed fees?

I only do payrolls if it is part of a larger accounts job. I charge for everything combined. Every year or so I will review my fees, which will take into account things like auto enrolment.

But, to be honest, the 2-3 minutes one-off cost of opting-out a director-only company from AE is not a big consideration when I assess my fees. If it took a couple of hours per client, then I would take a different view about charging.

By the way, if you don't have the AE letter code you can obtain it from The Pensions Regulator website so long you have the PAYE reference and Accounts Office reference.

One of my personal considerations is that I have a relatively easy life, so for me a one-off investment of 2-3 minutes per client was well worth the days of hassle it avoids in 1-2 years time.

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By mumpin
02nd Aug 2017 12:21

Seems like the jury is out on the Declaration then...

To further confuse matters I have two payrolls which HMRC have "closed down". They are limited companies which are not trading at present but may resume trading in the future. After receiving a certain number of Nil EPS's HMRC decides that the Paye scheme is no longer needed. Are Pension Regulator declarations needed for these?

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to mumpin
02nd Aug 2017 16:27

If in doubt, do it.

Why risk a £400 penalty?

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05th Sep 2017 12:36

It is not necessary to complete a Declaration of Compliance if you have told the Pensions Regulator that you are "not an employer"
This is the email reply you will get:

Thank you for telling us that you’re not an employer for the purposes of automatic enrolment.

This email is to confirm we have updated our records to reflect that you're not an employer at this time. Under the Pensions Act 2008, automatic enrolment duties no longer apply to you.

However, if your employer circumstances change in the future, you must let us know by emailing [email protected] with your letter code and PAYE reference, as legal duties may apply.

Regards

The Pensions Regulator

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