... they will charge employers a one-off charge of £500 for using enhanced support services.
What are "enhanced support services"? Doing the status assessment? Doing the letters to employees?
As we do these ourselves, will we have to pay £500 for the privilege of setting up a scheme and uploading enrolment and contribution files every month?
I deliberately didn’t suggest as an agent those will appeal as I know PBIK will be unwelcome if P11Ds currently deliver an income stream for the tax team. And this is the nub of the issue with payrolling: controlling your clients’ enthusiasm!
The first sentence quoted is incoherent, but the gist seems to be that agents will want to continue to do P11Ds in order to charge fees to clients. It may be the practice of some to undertake unnecessary work for clients, but most of us find P11Ds a complete pain which requires a review of the company's records usually as a separate exercise from preparing the company's accounts.
Yet more scaremongering by those with a vested interest in AE, combined with a blatant plug for the author's product.
There is another option.
5. Tell the client which pension providers your payroll software will support
... and let him choose one. As the OP confirms, "directing the employer to a particular workplace pension scheme is not a regulated activity" and I do not accept that there is much risk of straying "unwittingly into giving regulated advice", which is giving advice to individuals about their own pensions.
Instead the regulatorrequires details of a primary contact who will be the most senior person within the organisation responsible for auto enrolment duties, these details will enable TPR to write to them with updates or information.
Requires? Does TPR have any legal power to "require" or demand that a primary contact be notified? If a primary contact is not notified, why wouldn't TPR write to the same address as used for the letter "requiring" details of a primary contact?
Samantha Mann wrote:
Details of the secondary contact should be provided because they will be carrying out the day-to-day tasks of managing auto enrolment and TPR will send help and guidance by email.
What is the point? If the secondary contact would be someone else who works for the employer, the primary contact can simply pass on the e-mails he receives. If the secondary contact would be the accountant or payroll service provider, they are not going to want to receive identical mailings for all their clients.
Many of the employers now receiving the "name your primary contact under threat of penalties" letters a year or two ahead of their staging dates are director-only companies who will not be subject to AE.
Why do I get the feeling that pension professionals are trying to whip up a perfect storm about AE out of self-interest?
Those firms that employ low-paid staff who aren’t eligible for auto enrolment must still have a pension scheme in place so that these workers can opt-in or join the scheme.
Why is there a need to have an AE compliant pension scheme in place before any Non-eligible Jobholders choose to opt in? Is this just a matter of the practical difficulty of being able to set up a scheme in time if someone does ask to opt in?
As Entitled Workers only have the right to ask their employer to run a pension scheme for them, to which the employer need not contribute and which is not therefore an AE compliant scheme, why do you say that there must be a pension scheme in place just in case an entitled worker might ask to join one?
Why make so much mention of the various payroll applications' ability to file RTI reports? It is a statement of the obvious. If they couldn't file RTI reports, they would be useless as payroll applications.
Furniss told delegates at the Xerocon event in London today that the payroll market has been marked by a lack of innovation in recent years
What about the innovation of handling RTI?
Quote:
... and vowed, “ We want to do to the payroll industry what we did to accountancy.”
You may have done something for book-keeping, but you have done nothing for accountancy.
Quote:
The initial launch will be a fairly basic payroll application, focusing on the needs of companies with fewer than 10 employees.
Oh! You mean that it will be targeted at users of HMRC's Basic PAYE Tools. Not much for the real payroll software providers to worry about, then.
Quote:
The payroll module will be capable of filing RTI returns ...
It would be useless if it couldn't.
Quote:
... and can accommodate the basic information types required for auto enrolment, but more sophisticated AE communication and reporting features are more likely to be supported by specialist add-on developers via program links, Furniss told AccountingWEB.
So, nothing earth-shatteringly innovating about that.
With businesses staging for AE shooting up from 40,000 this year to 500,000 in 2016 and then 800,000 in 2017, how are you preparing for your clients?
They may have a staging date, but how many of them will need to set up an AE compliant pension scheme?
It is not surprising that small employers are confused about the requirements of auto-enrolment when the letter from the Executive Director of TPR a year ahead of the staging date is full of dire warnings, but completely fails to mention that if the employer has no staff (workers) apart from the director(s), the letter can be ignored because the company is not required to set up an AE pension scheme. Many such OMBs may well be ignorant of the AE requirements, but as they are not affected, why should they know anything about it?
It would be more helpful to all of us if those in the pensions industry put pressure on TPR to mend its ways, rather than trying to frighten accountants by making mountains out of molehills.
TPR has advised that when a business receives its 12 month advice notice it ought to write back immediately to inform TPR that it has no “workers” and therefore is exempt from the AE process in full. There is an option to lodge this online, however the business has to quote the reference number which will appear on the notice, whether the exemption response is made in writing or online.
There is no mention of this in the recent TPR letter to one of our clients whose staging date is 1 February 2016. Apart from the dire warnings of new legal duties and "Act now", the letter just goes on about nominating an e-mail address for future communications.
My answers
Enhanced support services?
What are "enhanced support services"? Doing the status assessment? Doing the letters to employees?
As we do these ourselves, will we have to pay £500 for the privilege of setting up a scheme and uploading enrolment and contribution files every month?
What a ridiculous attitude
The first sentence quoted is incoherent, but the gist seems to be that agents will want to continue to do P11Ds in order to charge fees to clients. It may be the practice of some to undertake unnecessary work for clients, but most of us find P11Ds a complete pain which requires a review of the company's records usually as a separate exercise from preparing the company's accounts.
Option 5
Yet more scaremongering by those with a vested interest in AE, combined with a blatant plug for the author's product.
There is another option.
5. Tell the client which pension providers your payroll software will support
... and let him choose one. As the OP confirms, "directing the employer to a particular workplace pension scheme is not a regulated activity" and I do not accept that there is much risk of straying "unwittingly into giving regulated advice", which is giving advice to individuals about their own pensions.
More guff on AE
Requires? Does TPR have any legal power to "require" or demand that a primary contact be notified? If a primary contact is not notified, why wouldn't TPR write to the same address as used for the letter "requiring" details of a primary contact?
What is the point? If the secondary contact would be someone else who works for the employer, the primary contact can simply pass on the e-mails he receives. If the secondary contact would be the accountant or payroll service provider, they are not going to want to receive identical mailings for all their clients.
Many of the employers now receiving the "name your primary contact under threat of penalties" letters a year or two ahead of their staging dates are director-only companies who will not be subject to AE.
Why do I get the feeling that pension professionals are trying to whip up a perfect storm about AE out of self-interest?
Are you sure?
Why is there a need to have an AE compliant pension scheme in place before any Non-eligible Jobholders choose to opt in? Is this just a matter of the practical difficulty of being able to set up a scheme in time if someone does ask to opt in?
As Entitled Workers only have the right to ask their employer to run a pension scheme for them, to which the employer need not contribute and which is not therefore an AE compliant scheme, why do you say that there must be a pension scheme in place just in case an entitled worker might ask to join one?
RTI?
Why make so much mention of the various payroll applications' ability to file RTI reports? It is a statement of the obvious. If they couldn't file RTI reports, they would be useless as payroll applications.
A Xero con
What about the innovation of handling RTI?
You may have done something for book-keeping, but you have done nothing for accountancy.
Oh! You mean that it will be targeted at users of HMRC's Basic PAYE Tools. Not much for the real payroll software providers to worry about, then.
It would be useless if it couldn't.
So, nothing earth-shatteringly innovating about that.
TPR is the main source of misinformation
They may have a staging date, but how many of them will need to set up an AE compliant pension scheme?
It is not surprising that small employers are confused about the requirements of auto-enrolment when the letter from the Executive Director of TPR a year ahead of the staging date is full of dire warnings, but completely fails to mention that if the employer has no staff (workers) apart from the director(s), the letter can be ignored because the company is not required to set up an AE pension scheme. Many such OMBs may well be ignorant of the AE requirements, but as they are not affected, why should they know anything about it?
It would be more helpful to all of us if those in the pensions industry put pressure on TPR to mend its ways, rather than trying to frighten accountants by making mountains out of molehills.
What does this mean?
Why does the letter say nothing about this?
There is no mention of this in the recent TPR letter to one of our clients whose staging date is 1 February 2016. Apart from the dire warnings of new legal duties and "Act now", the letter just goes on about nominating an e-mail address for future communications.
TPR needs to get its act together.