SMEs underestimate time and cost of auto enrolment in 2016
KashFlow recently conducted a survey among SMEs, looking into how prepared they are for auto enrolment.
The highlights of the survey include:
-An alarming proportion of businesses are expecting to manage their auto enrolment manually
-A significant level of businesses have underestimated the costs involved for auto enrolment
Not being prepared for auto enrolment
Of the SMEs surveyed 52% said they did not know their responsibilities around auto enrolment with 49% adding that they are not even aware of when their staging date is. Half of the businesses surveyed also remarked that they plan to prepare less than 6 months before their staging date.
The Pensions Regulator, the body responsible for delivering auto enrolment compliance and for communicating the auto enrolment duties to employers, intermediaries and providers, recommend that businesses begin preparing for auto enrolment 12 months before their staging date. This is because the demand for services and help is likely to increase as around 1.8 million businesses are set to stage between now and 2018.
Risk of non-compliance
Nearly 60% of the SMEs surveyed said that they plan to manage auto enrolment manually. Not only is manual auto enrolment time consuming but you also run the risk of being non-complaint, so it’s advised it should only be carried out by an auto enrolment expert. Non-compliance will result in a business being penalised, facing a maximum fine of £10,000 depending on the size of your business.
Cost of implementation
Most of the SMEs surveyed generally took a dim view of auto enrolment. 35% said it will have a negative impact whilst 58% said they foresee it having no impact at all. A further 37% said that it will have no financial impact on their business’ cash flow. According to information compiled by the Centre for Economics and Business Research the average auto enrolment costs for smaller firms of 1 to 4 employees is £8,900. To reduce the costs involved with auto enrolment the best option is to invest in effective auto enrolment software, such as what KashFlow offers to help simplify the process, saving your business money, but time as well.
Auto enrolment help is at hand
The KashFlow AE suite has auto enrolment assessment fully integrated into payroll. Not only will it process payroll and auto enrolment simultaneously but it will run automatically every payroll whilst ensuring your fully compliant at the same time. If you’d like to discuss setting up a demonstration of the KashFlow AE suite then feel free to telephone our friendly team on 0800 133 7927 (Option 1).
If you are staging for auto enrolment this year and require more information on how to save time and money then download our whitepaper and see how KashFlow can streamline the entire process.
For a free no-obligation 1-2-1 demo just call the KashFlow on boarding team on 0844 815 5779.
