Pensions reform: employers must act now, warns adviserSep 12, 2013
Delegates at the firm’s Advisory Circle briefing next week for smaller independent accountants will hear Renny Wickham, manager at Mazars Employee Benefits Ltd, highlight the key messages that every business owner needs to bear in mind.
Topics for the briefing include employee benefits, share schemes, pensions and remuneration planning.
Mr Wickham said: “We do not believe business owners have given enough consideration to the huge impact the introduction of auto-enrolment is going to have on their businesses.
“The key issue is that directors must give themselves time to prepare and manage this process properly.
“We have already seen that some of the UK’s largest companies have struggled to be fully compliant, so the burden on the country’s smaller companies, which make up the majority of businesses by number, is going to be even greater.
“You need to understand how auto-enrolment will impact on your current business processes, and how it will change or integrate with payroll and HR issues.
“Pensions experts can help but the onus – the regulatory responsibility – is on the business owner to ensure that they fulfill the requirements of pensions reform.”
The new regulations will have a significant financial impact on budgets.
“Whereas the impact in the early days is fairly minimal – a minimum of a 1% contribution by both the employer and the employee – by 2018 this will rise to 8%, with the company obliged to pay in a minimum of 3%,” said Mr Wickham.
Some 40,000 companies with less than 500 employees will need to have their auto-enrolment arrangements in place and compliant by the end of next year
Mazars Employee Benefits Ltd is working with many businesses across the UK to help them project manage the auto-enrolment process. Mr Wickham warned business owners not to leave it too late.
“If you are looking for help next year, when you go to the well for advice you may find it dry, because companies such as our own that can help you may already be at full capacity, leaving you high and dry and with no alternative but to try and implement the new regulations yourself.”