Since the end of 2015, one of the most common questions we receive from accountants and IFAs is "What happens if my client misses their staging date?". Below we will cover some of the consequences of missing the staging date, and highlight the steps that advisers can take to ensure that their clients are compliant with auto enrolment regulations.
What is a "staging date?"
This is the date allocated by The Pensions Regulator (TPR) and is when an employer's auto enrolment duties begin. One of those duties may be to set up a workplace pension scheme if there are any eligible jobholders. The date would typically depend on the size of the organisation, with larger organisations receiving their staging date earlier than smaller ones. If the business has not received their staging date, they will need to check for it on the The Pensions Regulator's website and have their PAYE reference number to hand. New employers will also have auto enrolment duties when they employ a new member of staff. This is known as the 'Duties Start Date'.
According to The Pensions Regulator, between July 1st and 30th September 2016, 3,728 fixed penalty notices were issued to organisations that failed to comply with their allocated staging dates. The fixed penalty charge is £400, and is usually issued to an organisation after The Pensions Regulator has attempted to make contact several times. Typically, a fine is issued to an organisation a few months after the staging date has lapsed. Additionally, if an organisation has missed their staging date they will be limited in their options in applying for a postponement period for any of their employees and the organisation will be compelled to make good all contributions from the original staging date. Typically, missing the staging date will also incur additional charges from payroll providers for the extra work.
What if I've missed the staging date?
Don't panic! One of the first actions any organisation should undertake if they missed their staging date is to contact The Pensions Regulator immediately. The Pensions Regulator will assist and advise you on how to rectify the situation as quickly as possible. Typically, The Pensions Regulator will advise to contact an auto enrolment provider and get back on track – Smart Pension is very well versed in assisting advisers and their clients in this way. Usually within three months of the staging date the organisation will have to deduct and pay backdated contributions for any eligible employee. If an organisation is three months over their staging date they will have to cover the cost of both the employee and employer contributions from the original staging date to the current date.
Smart Pension has a specialist on-boarding team to help any organisation that has missed their deadline. We are more than happy to assist and support you and your clients through this process to ensure that all relevant actions are taken to satisfy regulations, make good any unpaid contributions and get relevant pension schemes running efficiently and smoothly.
Our dedicated webpage, What If I Miss My Staging Date is designed to help you get back on track and meet all your compliance needs.
For more information, visit us on https://www.autoenrolment.co.uk or call us on 0333 666 2020.