Pension fine fears prompt record month for Pierce payroll team
Fears of £10,000 per day fines for failing to comply with pensions auto enrolment legislation contributed to a record month of new payroll clients at Lancashire accountancy practice Pierce.The growing burden of payroll-related red tape which must be shouldered by SMEs in the region was another factor in attracting 22 new payroll clients to Pierce Chartered Accountants, which offers a full range of accountancy and business support services.
A failure to comply with can result in fines of up to £10,000 a day. In the first quarter of 2016 3,057 companies were served with Compliance Notices from the Pensions Regulator, of which 806 were charged with a fixed penalty notice.Pierce, which has headquarters in Blackburn, Lancashire, is now managing payroll administration services to around 500 additional people with client companies. Pierce now handles the payroll for over 400 companies and 3,500 people.
Lisa Kennery, payroll manager at Pierce Chartered Accountants, said: “The auto enrolment process can place a heavy burden on those managing its administration. Many businesses need to source advice from professionals when setting up pension auto enrolment in order to ensure that they comply with regulations and that the process is set up correctly.“When advising clients, it has become apparent that some do not process the right software, knowledge or resources to properly manage their pensions and payroll capacity. We advise them on how to set up a robust system, but many opt to outsource to us.”
Under the pension Act 2008, every employer in the UK must put eligible staff into a pension scheme and contribute towards it.
All employers have to operate PAYE as part of their payroll, unless none of their employees earns over £112 a week, receives benefits and expenses, have another job or a pension. PAYE is HMRC’s system to collect Income Tax and National Insurance.