The Pension Regulator has shared information on two updates to the automatic enrolment pages of TPR’s website.
These are designed to support employers and advisers in understanding their legal automatic enrolment duties.
Common error video clips
Employers are still making a number of common errors in relation to automatic enrolment, some of these include:
- using the wrong pension contribution tax relief method
- not correctly identifying elements of gross pay as qualifying earnings and as pensionable pay
- the use of postponement
Earlier this year, TPR ran an AE-focused webinar for advisers that included information on these key common errors.
TPR have now produced some short video clips from the webinar which capture these points and are now live on a brand-new webpage on our website, and are encouraging partners to share these via our content toolkit on social media and through their own channels.
Advisers helping their clients with automatic enrolment duties may find these short video clips on these issues useful. The information may also help employers avoid making common errors and prevent risk of non-compliance that could be costly and result in unnecessary fines and/or penalty notices.
New duties timeline tool
TPR have also created a duties timeline tool, designed to help employers and advisers understand their automatic enrolment duties, what they need to do and when. All employers need is their duties start date to access their tailored timeline. At this time TPR are encouraging employers and advisers to use the tool, and remember:
- Employers’ legal duties begin on the day their first member of staff starts work, known as their duties start date.
- Even if employers think they won’t need to put staff into a scheme, they’ll still have duties.
When Net means something different!
Employers and pension specialists can be very confused over official HMRC terminology as it is written from their perspective and not that of common thought.
When the term net is used in relation to pensions it is stated from the aspect of the HMRC view that tax is deducted on the net of gross pay minus the employee pension contribution, so pensions is a before-tax deduction and not an after tax deduction.
And tax Relief At Source pensions schemes actually have no tax relief in the payroll operation.
No wonder it is common for pensions, as a result of this extremely confusing reverse logic terminology, to be being applied incorrectly for a sizeable number of employers. This can be seen as a major issue from the reported data to HMRC on the RTI FPS data.
Correction of past error can be onerous and expensive.
PAYadvice.UK 7/11/2024