1.8m small or micro entities are due to stage between 2016 and 2018. These responsibilities are severe and there’s no way out of them. For these businesses, payroll software will play a role in handling this burden.
But auto enrolment remains an unknown quantity for a lot of accountants. “I have been speaking with a lot of accountants and what has surprised me is that a lot of them haven’t exactly got into auto enrolment in a big way,” says BrightPay's director Paul Byrne.
There’s no escaping auto enrolment. So it is important these businesses are prepared. “They have to get pension schemes sorted out, decide which pension scheme they’re going to go with, and then, they have to ensure they have the correct systems in place…” lists Byne.
“Form filling and manually logging on to websites to complete employee details of every pay period – that would be a nightmare. They wouldn’t have time for it,” adds Byrne.
Outside of the workload, the consequences of SMEs missing their staging date are bleak. For example, if you missed it by three months you are than liable for the employee deductions as well, as your own contributions – and from there the fines escalate.
“People are going to try and hide from them or just going to get it wrong,” warns Byrne.
But a lot of this auto enrolment work can be completed by the click of a couple of buttons in payroll software.
Accountants can 'make your life easier'
“[Payroll software] has all the details necessary to figure out whether someone needs to be enrolled or not, it has the details of what contributions or deductions need to be applied, so it’s a natural fit to put all those processes within the payroll.”
Byrne is keen to steer people away from using HMRC’s basic PAYE tools which will not be able handle auto enrolment. Instead, Byrne recommends using the appropriate payroll software to alleviate the labour intensive alternative.
“It’s a huge opportunity for accountants,” says Byrne. “They should be telling their clients who do their own payroll, that we can do all of this for you – we can take all this responsibility and make your life easier.”