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Is the Pensions Regulator heavy handed?

Fines are high for small businesses and unpleasant phone calls etc. during difficult times

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We have had a few cases of the pensions regulator issuing fines to our clients for non-payment of contributions.  The fines are £400 per time and there are also daily penalties of £50 per day.  In all cases the contributions unpaid amount to less than or similar amounts to the fines levied.  These have been issued to clients that are experiencing cashflow difficulties.  The fines serve to add to the problems during a difficult time.  I know you can appeal but there are questions like 'what did you do with the contributions that you took from your employees?' as part of the appeal form.  Basically, by the time the contributions were due to be paid, the overdraft etc. had been maxed out.  The other situaition we've had is a company that has closed its doors but not able to appoint its own liquidator due to having no funds, so waiting on the bank to appoint one.  The pensions regulator has doggedly pursued this client, with escalating phonecalls, no matter how many times you explain the situation, daily penalties of £50 per day, plans to come out and visit you and your client, who have already left their premises.  They have been quite unpleasant and, again, the contributions at stake are minimal.  Is this good policy when businesses are experiencing difficult times?

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By tom123
28th Mar 2019 15:51

I get where you are coming from, but if I was an (ex) employee I would want to know why my contributions had not been paid over.

I wouldn't care about the tax, as that is no longer my money, but the pension is.

I guess if they publicize this more there will be a decent deterrent.

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28th Mar 2019 16:06

Rather than "experiencing difficult times" it would seem that your clients are in fact "not viable businesses" and taking money from their employees under the pretence of paying it into their pensions and then keeping it should open them up to more than just nasty phone calls.

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to Duggimon
28th Mar 2019 16:47

Well quite

The relatively small sums ought to be easy enough to pay over, even for a bad business going down the tubes.

Perhaps the OP needs to change the advice they give to their clients about their responsibility for payroll? Ie its not fugging well optional, its money you have taken from your employees wages.

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29th Mar 2019 11:16

Agree with the other sentiments. Failing to pay over pension deductions is, in effect, stealing from the employees..

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By SXGuy
29th Mar 2019 13:01

Similar situation with a client of mine.
Her business lost the contract to an old company, and gained one for a new company. However the new company is stupidly late in paying, and as such they have had cashflow issues.
She has every intention of paying the pension contributions that are due, but is finding it difficult to do this will her invoices remain outstanding.

She to has received a £400 fine.
Ive explained to her that I have stopped filing pension details because each and every time the direct debit bounces they cancel the mandate, im not about to keep creating new ones each month only for them to bounce again.

I agree though that the fines are heavy, and if the company has every intention to pay the contributions when their cashflow picks back up, they should at least give some time.

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By dross5
02nd Apr 2019 10:07

Thanks for your responses. Not a great deal of sympathy out there it seems. However, as SXGuy suggests, businesses do get into financial difficulties for all sorts of reasons and, while fully intending to pay when they have the funds, physically can't at certain times.
Glad I don't work in some of the other posters' offices when a client comes in looking for help.

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