WTK FINANCIAL SERVICES LTD. Guide to Auto-Enrolment

Transcription

1 WTK FINANCIAL SERVICES LTD Guide to Auto-Enrolment

2 welcome We provide independent financial planning advice to individuals and companies. We offer a wide range of services that includes advice on personal and corporate investment, inheritance tax planning, trust and business planning and all types of pension schemes (including employee benefit schemes). We seek to provide a high quality service that is designed to take care of you over the long term, never losing sight of the fact that we must deliver financial planning strategies that fulfil your requirements. This ethic has helped us to retain a high degree of loyalty from our clients and other professionals with whom we are associated. We are extremely proud to have been awarded the much coveted Chartered Financial Planners title by the Chartered Insurance Institute (CII). The award of the Chartered title is strictly controlled by the Privy Council and is a measure of the very highest standards of professionalism. We are one of approximately 500 Chartered Financial Planner companies within the UK (the Financial Conduct Authority currently regulates approximately 29,000 firms). Our Chartered status demonstrates commitment to our clients and evidences the superior quality of our professional advice and service. We firmly believe that it sets us apart from our competitors.

3 what makes us different? Although our team is small in comparison to some large banks and insurance companies, our clients benefit from having a one-to-one service from their adviser with the backup of our dedicated administration team. We are committed to providing a structured ongoing review service which means that your financial arrangements are appraised regularly so that they can be adapted in light of changing personal or economic circumstances. Part of what makes us different is our focus on your goals and objectives, rather than selling you a product. All advisers can sell you a pension plan or investment fund. Very few have what it takes to consider the bigger picture. As Independent Advisers we have unrestricted access to the whole of the market which means that we have no barriers in providing an unbiased solution that is best for you. We work as a team and that also makes us different. As well as the relationship you will have with your adviser, you will also have a team of experienced individuals working behind the scenes to help you to achieve your goals. Our Support Team takes care of all the administration as well as assisting with research and reporting. We are very accessible and are happy to visit you at your home or place of work and we also welcome clients who prefer to have their meetings with us at our offices. We want to be available when you need us. We know that you will value our opinions and we are always happy to have a conversation with you.

4 guide to auto-enrolment Pensions reform legislation will bring thousands of people into retirement saving for the first time. It aims to reduce reliance on the State for retirement income. It came into force on 1 October 2012 and requires employers to: provide a pension scheme that meets certain minimum criteria automatically enrol eligible jobholders contribute to the pension scheme at a minimum prescribed level This guide explains the steps to preparing for auto-enrolment, gives you the key points you need to know and actions you can take to achieve compliance as effectively and efficiently as possible. If you haven't started planning for autoenrolment, this guide should be a useful starting point. If you have, then it could be a useful reference document. If you would like further help or advice about auto-enrolment and workplace pensions, we will be happy to assist. Inside this guide: 1 Know your staging date 2 Assess the workforce 3 Existing arrangements 4 Starting a new scheme 5 Communication 6 Automatic enrolment 7 Record keeping 8 Contributions 9 Employer checklist 10 Our services 4

5 1 know your staging date All existing employers with 250 or more staff must start by 1 Feb 2014 Start planning now!!! The Government has already set out the staging dates for all employers. How soon your organisation must comply with the rules will depend on the size of your PAYE scheme as at 1 April 2012, with the largest employers starting first. If your organisation has multiple PAYE references, the size of the largest one determines the staging date for all the others in the group. The following table summarises the staging dates, but doesn't show the detail for employers with less than 62 employees. If you fall into this group, please contact us to find out your exact staging date. PAYE scheme size or reference Staging date 120,000 or more 1 October , ,999 1 November ,000-49,999 1 January ,000-29,999 1 February ,000-19,999 1 March ,000-9,999 1 April ,100-5,999 1 May ,000-4,099 1 June ,000-3,999 1 July ,000-2,999 1 August ,250-1,999 1 September ,249 1 October November January February April May July August April 2015 Fewer than 50 1 June April 2017 Employer who does not have a PAYE scheme New employer (PAYE income first payable between 1 April 2012 and 30 September 2017) 1 April May February 2018 Whatever your staging date, early preparation will help to make the transition to this regime as smooth as possible. 5

6 2 assess the workforce TPR has some useful flowcharts online for assessing the workforce Understand your pay reference periods You will need to establish three things when you assess your workforce: The worker's age Whether the worker ordinarily works in the UK Whether qualifying earnings are payable in the relevant pay reference period. 2.1 Pay reference periods This is the period of time to which an amount of pay relates - because workers must be assessed based on their earnings in the pay reference period in which the assessment day falls. This means that the assessment is based on pro rata thresholds. The table below gives a breakdown of the 2015/16 figures by pay reference period on a pro rata basis. Pay reference period Lower earnings limit Earnings trigger 1 week Fortnight weeks month quarter 1, , Bi-annual 2, , Annual 5, , These criteria will determine into which category of worker an individual, or group falls, and thus what your employer duties are. The Pensions Regulator (TPR) has some very useful flowcharts to help employers with making their assessments of workers and groups of workers. 6

7 2 assess the workforce Maximum probation /waiting period = 3 months Must give written notice to postpone to the affected worker(s) Written notice must set out the deferral date 2.2 When to make the assessment Employers will have to assess a worker on: the employer's staging date, for a worker already in employment on that date the first day of employment, for a worker who starts employment after the employer's staging date the date of the worker's 22nd birthday, where this occurs after the employer's staging date the date of the worker's 16th birthday, where this occurs after the employer's staging date the deferral date, if an employer has chosen to use postponement for a worker the first day of each pay reference period, where the first assessment identifies the worker to be a non-eligible jobholder or entitled worker. In other words - each week for weekly paid workers, or each month for monthly paid workers. 2.3 Postponement This allows employers to choose to postpone automatic enrolment for a period of their choice of up to a maximum of three calendar months. Postponement could be useful where employers wish to: a) smooth the process of automatic enrolment duties: for workers with rare spikes in earnings, or short-term workers who leave soon after starting work, or workers who trigger automatic-enrolment just before ceasing employment. b) smooth the process of staging for example, automatically enrolling different groups of workers at different points in the three-month period. c) align auto-enrolment with existing payroll processes such as to fit in with an existing probation period, or to avoid calculating contributions on part-period earnings. An employer can choose to use postponement in respect of an individual only on certain dates: their staging date, in respect of any workers employed on their staging date 7

8 2 assess the workforce the first day of employment, in respect of any worker starting employment after the employer s staging date the date a worker employed by them meets the criteria to be an eligible jobholder after the employer s staging date. All workers have the right to opt-in to the pension scheme during the waiting period. They are not obliged to wait for the deferral date. Employees with fluctuating earnings An employer may use postponement a number of times. If on assessment at the deferral date the worker's earnings do not reach the trigger level for that pay reference period, they will not need to be autoenrolled. When the earnings in the relevant pay reference period next reach the trigger level, the employer may use the three month postponement option again. If on the deferral date the worker does qualify then that is the automatic enrolment date for the individual. Contributions must be accrued and scheme membership must take effect from that date. The Pensions Regulator has a useful flowchart for employers assessing a worker on the deferral date. Workers who are found to be eligible jobholders after being assessed on the deferral date must be automatically enrolled within one month. EXAMPLE 1: Roger works for ABC Ltd, he earns 25,000 and will turn 22 on 14th September. The 22nd birthday is an assessment date but it falls right in the middle of ABC Ltd's monthly pay reference period which runs from 1 September to 30 September. To ease administration, ABC Ltd decides to postpone Roger's automatic enrolment date until day one of the next pay reference period (1 October) and gives him notice of the postponement and the deferral date of 1 October. On 1 October, ABC Ltd must run the assessment again and it identifies Roger as an eligible jobholder. This becomes Roger's automatic enrolment date - the date from which he must be automatically enrolled and from which the calculation of contributions starts. EXAMPLE 2: Anna is 23 and works for XYZ Holidays Ltd whose staging date is 1st May. She ll earn 700 pm but is employed for just 10 weeks during the summer peak, and starts work on 1 June. The first day of employment is an assessment date, but her employer knows that she will have left by 1 September. They decide to postpone until this date and give Anna notice of postponement and the deferral date of 1 September. On 1 September XYZ Holidays Ltd must run the assessment again and find that Anna is not an eligible worker because she has now left the company and has no relevant earnings in the 1 September to 30 September pay reference period. 8

9 3 existing arrangements Seek advice early if current scheme needs to be changed May need union approval or consult with staff Check existing pension provider will carry on with scheme on current terms and charges Making your existing scheme compliant Employers with existing pension schemes will need to establish whether their schemes meet, or can be amended to meet, the qualifying scheme criteria. Otherwise the employer will need to establish a new scheme which meets all the criteria, or use NEST (National Employment Savings Trust). If you already operate a good quality pension scheme you may use it to fulfil your employer duties provided it meets certain minimum standards - the qualifying criteria and the auto-enrolment criteria. Qualifying schemes must: be an occupational or personal pension scheme be tax registered, and satisfy the minimum requirements for that type of scheme* *These are quite specific and lengthy, particularly for defined benefit (DB) and hybrid schemes. If you need help establishing whether your scheme meets the requirements, info@wtkltd.co.uk to arrange an auto-enrolment review. Auto-enrolment scheme rules must not: prevent the employer from automatically enrolling, opting-in or re-enrolling a jobholder require the member to make a choice (therefore there must be a default fund) require the member to complete an application form to join have a minimum age above 16 make SMART salary exchange compulsory Existing contract based schemes Group Stakeholder Pensions (GSHPs), Group Personal Pensions (GPPs) and Group Self Invested Personal Pensions (GSIPPs) must have a legally binding agreement between the provider and the employer under which the employer has to make the required minimum employer contribution. If the employer is not paying all of the total required contribution, there must be a similar legally binding agreement between the provider and the member under which the member is required to make up the difference. They may choose to pay more than the minimum if they so wish. If your scheme rules don't comply, you may need to take legal advice to change them, or you may decide to take the opportunity to start a new scheme. 9

10 4 starting a new scheme No frills schemes won t provide advice to members Traditional and alternative providers are teaming up to provide joined-up solutions Software could be key to simplifying compliance with the rules 4.1 Traditional pension scheme providers A key advantage of a traditional pension scheme is that it can support a full financial planning service for members. This may be a far better option for more senior staff. The majority of company pension scheme providers, such as Scottish Widows, Standard Life, Aviva, Legal & General and Aegon, will provide a new type of simple scheme that meets the auto-enrolment criteria set out by the Pensions Regulator. These will be "no-frills", low-cost schemes with less flexibility than most GPPs and there will be no provision for advice to members. That said, as the rules apply to all employers of 1 or more workers, there will be some very small schemes that it will not be profitable for the private sector to operate. These no-frills schemes can run alongside existing or new GPPs which offer a wider range of services to members while remaining fully compliant with the new rules. 4.2 Partnerships with new providers Some of the traditional providers have teamed up with no frills scheme providers to provide a joined-up solution, as summarised in the diagram below. Middleware platform with ongoing support Integration with payroll & HR systems Single interface manages all aspects of autoenrolment Connectivity to alternative pension providers Simple, cost effective solution with streamlined processes Compliance with auto-enrolment legislation 10

11 4 starting a new scheme Selecting a new scheme requires research and preparation NEST is not the only option for no-frills/ low cost schemes A multischeme approach enables schemes and services to be tailored to specific sections of the workforce 4.3 Alternative pension providers For firms without suitable existing workplace pensions, there are now three main alternatives to be considered: NEST National Employment Savings Trust Founded by the Government to ensure that there was a scheme into which employees could be enrolled the fear being that traditional scheme providers would be unable to accommodate large numbers of low contribution members. It must accept all employers that apply to it, including the smaller schemes and smaller contributions which might be turned down by other providers. The People s Pension Run by B&CE, a UK construction industry benefits provider, The People s Pension has been launched as a direct competitor to NEST. B&CE have many years experience in handling high volume payrolls in an industry with high staff turnover. NOW: Pensions Danish provider of workplace pension solutions, launching in the UK to provide an auto-enrolment service alternative to NEST. Significant experience in running successful large-scale schemes in Denmark. All three providers claim to deliver low-cost auto-enrolment solutions under a money purchase, trust-based, scheme framework. However there will be differences between them in the level and range of support and service provided and, certainly in the case of NEST, rules limiting members options, such as transfers in and out of the scheme. 4.4 Multi-scheme approach You are not limited to using a single scheme. You may choose to operate several schemes for different parts of your workforce. This approach allows you to provide enhancements such as personalised advice (e.g. how much to save, where to invest) to your more senior employees through a Group Personal Pension or similar scheme. At the same time groups of workers who are lower paid, or where there is a high turnover, can be provided with compliant pension schemes such as those mentioned above. 11

12 5 communication Keep evidence of compliance with the rules Must provide info to everyone, even those already in a pension scheme Strict timescales are set for provision of info Bottom line: you are responsible The Pensions Regulator takes pains to spell out the communication requirements. There are obligations at every stage, which continue into the future. Furthermore, the relevant communications must be made within prescribed time limits. The basic communication requirements depend on the category of worker (see section 6 for an explanation of these categories): Eligible jobholders Jobholders being automatically enrolled must be provided with information about their automatic enrolment, what it means for them and their right to opt out. Eligible jobholders already members of a qualifying pension scheme must be provided with information about the scheme. Eligible jobholders subject to the transitional period for defined benefit (DB) and hybrid schemes must be provided with information about the deferral of automatic enrolment. Non-eligible jobholders Non-eligible jobholders must be provided with information telling them about their right to opt in to an automatic enrolment scheme. Non-eligible jobholders being enrolled after opting in must be provided with information about enrolment, what it means for them, and about their right to opt out. Non-eligible jobholders already members of a qualifying pension scheme with that employer must be provided with information about their active membership. Entitled workers Entitled workers must be provided with information telling them about their right to join a pension scheme. All workers If the employer uses postponement to postpone the assessment of all their workers at their staging date, they will have to give notice to all their workers. The rules also state that the information must be provided in writing. This can include but must not merely be a link to an internet or intranet site, and simply displaying a poster in the workplace is not sufficient. The information may be provided by a third party such as a financial adviser or employee benefit consultant but it remains the employer's responsibility to ensure that the information is provided, is on time, and is both correct and complete. 12

13 6 automatic enrolment This is the mainstay of the reforms and aims to tackle the inertia that has led to low participation in workplace pensions. The fundamental idea is that if individuals need do nothing to remain in the scheme, but that opting out requires some action on their part, a higher proportion of people will remain enrolled. This section of the guide looks at some of the key aspects of automatic enrolment. 6.1 Employer duties for each category Having completed a thorough assessment of the workforce, in advance of your staging date, you should have a clear picture of the number of employees who fall into each category (see the table below for a summary). Annual earnings (2015/16) Under lower earnings limit ( 5,824) Between 5,824 and 10,000 Age (inclusive) SPA* SPA* - 74 Entitled worker Non-eligible jobholder Over earnings trigger for autoenrolment ( 10,000) Non-eligible jobholder Eligible jobholder Non-eligible jobholder * State Pension Age Entitled workers - have the right to join a pension scheme, in which case employers must arrange pension scheme membership but are not required to make contributions. It could be argued that this group are the least likely to opt in as there is no requirement for the employer to contribute to the pension. However, there is nothing to prevent them from doing so. Non-eligible jobholders - have the right to join, in which case the employer must arrange pension scheme membership and make contributions. This group might be more likely to opt in as they will benefit from a compulsory employer contribution. If you have a large number of non-eligible jobholders you should make sure that your HR and payroll functions have the capacity to deal with the number of possible opt-ins. Eligible jobholder - must be automatically enrolled by the employer who must also make contributions. This is arguably the most straightforward category and you will have to fulfill all your employer duties with effect from your staging date. 13

14 6 automatic enrolment You can t opt-out until you ve been enrolled Fines of up to 10,000 a day if you re found to have induced staff to opt-out Bottom line: you are responsible 6.2 Opt-outs and re-enrolment Whilst an employee has the right to opt out of the pension scheme there is no right to opt out of automatic enrolment. The member must have been automatically enrolled as an active member of the scheme in order to subsequently opt out. As part of the information provided to workers about auto-enrolment they must also be told how they can obtain an opt out notice. Employers are prohibited by law from providing the opt out notice directly. Inducements The Pensions Regulator (TPR) has reminded employers that inducing staff to opt-out of retirement saving post automatic enrolment is strictly illegal. Although employers staging dates for auto-enrolment are spread over the coming five years, the law applies with effect from 1st July Inducement is defined as any action with the sole or main purpose of causing an employee to opt out. TPR has the power to take enforcement action on employers where evidence of inducement has been seen. This could include an initial fine of up to 400, plus escalating penalties of up to 10,000 a day for larger employers. Employers should take extra care to ensure that they do nothing which could be seen as an inducement or incentive to opt out because, even if their staging date is some way off, the law is already in force. For example, employees may join the pension and pay lower contributions than the required minimum, if the scheme rules allow. But this option must not be offered to induce an employee to opt out. Even if employees do join the scheme on such a basis, the employer will be required by law to re-enrol them along with any others who have opted out every three years. This re-enrolment exercise must take place within three months either side of the anniversary of their staging date. 6.3 Auto-enrolment and Fixed or Enhanced Protection For individuals who have applied for Fixed Protection 2012 and 2014, a higher Lifetime Allowance is available than the standard Lifetime Allowance of 1.25m, which came into effect 6th April Enhanced Protection provides an exemption from the Lifetime Allowance. The issues covered in this section apply to individuals with Fixed Protection and also to individuals with Enhanced Protection. 14

15 6 automatic enrolment Autoenrolment could result in unwitting loss of fixed protection Employees with fixed protection must not miss the opt-out window Tread carefully to avoid falling foul of rules on inducing employees to opt-out If you haven't already secured Fixed/Enhanced Protection, it's too late now to apply. For those who have secured protection, vigilance is required because it could be unwittingly lost as a result of autoenrolment. This is because the rules set out that it will be lost, and the standard lifetime allowance will apply, if: (i) (ii) (iii) you start a new pension arrangement other than to accept a transfer of existing pension rights you make new contributions to an existing pension arrangement you accrue benefits under an occupational pension scheme Auto-enrolment and losing Fixed or Enhanced Protection Employees with Fixed/Enhanced Protection should take extra care when it comes to their employer s auto-enrolment procedures. If the employer is automatically enrolling as part of their duty under the above legislation, employees must opt out within the one month opt out period. In doing so, the law treats them as if they were never a member of the scheme and Fixed/Enhanced Protection will be maintained. If the employee fails to opt out in time, Fixed/Enhanced Protection will be lost. Opt out every three years Even if you opt out in the first instance, under the provisions of the Act, employers must automatically re-enrol employees who previously opted out every three years. Employees should take care to ensure that they opt out within the one month period each time this happens in order to preserve their protection. If an employee with Fixed/Enhanced Protection changes employer and starts working for another employer with auto-enrolment duties under the Act they will be automatically enrolled. Again, employees should take care to ensure that they opt out within the allowed period, or Fixed/Enhanced Protection will be lost, and at all future autoenrolment points. What can employers do about this? While it is illegal to encourage employees to opt out, employers should be certain that their auto-enrolment procedures are robust enough to ensure that employees have sufficient time to opt out within the one month window. All employers using and preparing for auto-enrolment would be well advised to ask new (and existing) employees at an early stage whether or not they have Fixed or Enhanced Protection in place, particularly when recruiting for senior management and executive 15

16 6 automatic enrolment The Finance Bill proposes a power to prevent individuals losing fixed protection Seek advice now if you or your employees might be affected roles. This will enable both parties to ensure that the protection is not jeopardised. Auto-enrolment processes outside of the 2008 Act There may be instances where employees are enrolled into a pension scheme not covered within the provisions of the Pensions Act 2008 (for example, an employee who is not an eligible job holder due to age or salary but is automatically enrolled into a pension scheme run by the employer due to employment contractual terms). In this instance Fixed/Enhanced Protection will be lost regardless of whether they opt out. In these circumstances, employers and employees should raise the subject of auto-enrolment at the earliest possible stage to avoid being enrolled at all. There are reports that HMRC plans a retrospective power in the Finance Bill allowing changes to be made to the Fixed/ Enhanced Protection legislation, to ensure protection is not lost as a result of auto-enrolment. However, in the meantime there is no substitute for advanced planning. You don't have to auto-enrol: anyone under 22 Auto-enrolment key facts: anyone over State Pension Age people earning less than 10,000 annually people that don't work, or ordinarily work, in the UK people who are already in a qualifying scheme Whilst checking earnings and age for each pay reference period, employers must also keep an eye on cumulative earnings to ensure people are automatically enrolled in time. Payroll software may be able to automate some of these processes. Even those who are not required to be automatically enrolled may have the right to opt-in and you should have robust procedures in place to ensure this is done within the required time periods. 16

17 7 record keeping The new employer duties include keeping certain records. These can be stored in a paper or electronic filing system as long as they are legible or can be produced in a legible way. Employers must provide these records to the Pensions Regulator if requested. Records that must be kept about jobholders and workers Record is about: What must be recorded: Keep for: Jobholders and workers who become members Additional information for jobholders only Name National Insurance number (where one exists) Date of birth Gross qualifying earnings in each relevant pay reference period The contributions payable in each relevant pay reference period and the amount payable. This includes contributions due on the employee's behalf and deductions made from earnings The date contributions were paid to the scheme Automatic enrolment date Opt in notice The contributions to which the jobholder is entitled under the scheme rules (this demonstrates that the scheme used is a qualifying scheme) 6 years Additional information for workers only All workers for whom the employer has used postponement Opt out notice Date with effect from which the worker became an active member Joining notice Name National Insurance number (where one exists) Date the notice was sent to the worker 4 years 6 years Records that must be kept about auto-enrolment schemes Type of scheme: What must be recorded: Keep for: Defined contribution (DC), defined benefit (DB) or hybrid scheme Employer pension scheme reference Scheme name and address Scheme contracting out certificate (this applies to contracted-out DB schemes only) Any evidence showing that a scheme meets the test scheme standard (this applies to non-contracted-out DB schemes only) 6 years Personal pension scheme Employer pension scheme reference Name and address of pension provider 17

18 8 contributions Phasing should make the increase in costs and admin easier to manage Everyone pays the maximum amounts from October 2018 New employees joining during transition will begin paying the minimum level for that phase Qualifying earnings The minimum contribution requirement for auto-enrolment is based on a band of earnings known as qualifying earnings (QE). QE are earnings of more than 5,824 and less than 42,385 for the 2015/16 tax year. The QE trigger for the 2015/16 tax year is broken down by pay reference periods shown on page 6 of this guide. The components of pay that must be included in QE are salary/ wages, overtime, bonuses, commissions, statutory maternity pay, ordinary or additional statutory maternity pay, statutory sick pay and statutory adoption pay. Date Employer's staging date to September 2017 October 2017 to September 2018 October 2018 onwards Employer minimum Employee could pay Total required 1% 1% 2% 2% 3% 5% 3% 5% 8% 18

19 8 contributions Certification As an alternative to using the QE definition, employers can choose to certify that the scheme meets the minimum requirements. With certification, minimum contributions will be based on a scheme definition of pensionable salary and contributions will be based on the first pound of pensionable salary. There are three options for certification depending on the definition of pensionable salary that is used. These are described in the tables below. Tier 1 - Minimum total contribution = 9% of pensionable pay (defined as at least equal to basic pay). Date Employer minimum Employee could pay Total required From staging date to September % 1% 3% October 2017 to September % 3% 6% October 2018 onwards 4% 5% 9% Tier 2 - Minimum total contribution = 8% of pensionable pay (defined as at least equal to basic pay. Total pensionable earnings of all job holders to whom this then applies must be at least 85% of their total earnings when aggregated). Date Employer minimum Employee could pay Total required From staging date to September % 1% 2% October 2017 to September % 3% 5% October 2018 onwards 3% 5% 8% Tier 3 - Minimum total contribution = 7% of pensionable pay (defined as equal to total earnings). Date Employer minimum Employee could pay Total required From staging date to September % 1% 2% October 2017 to September % 3% 5% October 2018 onwards 3% 4% 7% 19

20 9 employer checklist 1. Check your staging date How long have you got to get ready? You may have until 2018 to start autoenrolment. 2. Assess the workforce Who will you need to auto-enrol? What are the current take-up rates and how will they increase? 3. Review existing schemes If you don't already have a scheme, get advice to ensure your new scheme qualifies. If you do have schemes, do they meet the qualifying criteria? Do changes need to be made to the waiting period or contribution levels? 4. Choose which scheme(s) you will use for auto-enrolment Do you have a good quality scheme(s) in place which your employees will value? 5. Take legal advice on changing scheme rules if required Do employment contracts need changing too? Is there a requirement for a staff consultation? 6. Budgeting for the costs What are the likely costs? Take into account increased employer pension contributions, extra administration, recordkeeping, any upgrades to payroll systems that may be needed etc. What about training for HR and finance staff? 7. Consider salary exchange Salary exchange arrangements make pension saving more tax efficient for both employer and employee. Could now be a good time to introduce it? 8. Increase scheme membership early Spread the cost and administrative burden and mitigate a spike at your staging date. Consider starting employer contributions early in place of salary rises. 9. Communication How are you going to tell your staff about auto-enrolment and comply with the Regulator s rules? 10. Seek board approval Will you have enough time to implement the changes once approved? How WTK Financial Services Ltd can help We can provide you with an autoenrolment review which will look at the following areas: Whether your existing schemes meet the qualifying criteria Amending existing schemes and designing new ones Using multiple schemes for different parts of your workforce How the profile of your scheme(s) will change Communicating with your employees Providing one to one advice in the workplace where appropriate Identifying who to auto-enrol 20

21 10 our services Stage 1: Assessing the Workforce We will gather all appropriate information required to produce a report which will give you an indication of the costs of establishing an Auto-Enrolment compliant scheme (including the cost of the employer contribution), analysis of your workforce, complete review of any current scheme(s), certification of earnings and comparison with alternative earnings definitions Stage 2: Payroll We will take a detailed look at your payroll systems and determine their Auto-Enrolment capabilities, addressing issues like payroll frequencies, pay reference periods and payroll cut-off dates. We will conduct a detailed Fact Find to determine your current situation and suggest what steps need to be taken to achieve full Auto-Enrolment capabilities. Stage 3: Employee Communication We can manage all employee communication about Auto-Enrolment (as is required by the legislation) and arrange for distribution to the various worker types, promote Work Place Pensions and their benefits, convey details of Postponement (if applicable), issue details of the opt out process, communicate to those eligible to join or those who pass through the earnings threshold and give details of Salary Exchange (if being used). Stage 4: Scheme Design We will advise you on the design of the scheme (whether this is a Group Personal Pension Plan with a Life Office, The People s Pension, Now Pensions or NEST) and agree which definition of earnings will be used for contributions. We can advise on a variety of options including fund choices, scheme charges and using Salary Exchange. Stage 5: Postponement We will consider postponement options with you and how it might be used across different worker types. We will help you implement postponement if appropriate. Stage 7: Implementing your scheme We can assist you with implementing your scheme, arranging all applications and ensuring that contributions are collected and remitted accordingly. We will ensure that you have a comprehensive Auto- Enrolment system in place to run the scheme, maintain employee records, manage opt outs, process refunds and achieve a comprehensive re-enrolment process every 3 years. We will also ensure that you register and report to The Pensions Regulator in line with the legislation. Stage 6: Implementing Auto-Enrolment Middleware We can provide a comprehensive Auto-Enrolment fully compliant software package which we meet all your requirements. This system will interact with all pension schemes and benefit packages that you operate and engage with your payroll, HR functions and pension provider. In addition it can help communicate effectively with your staff, NEST, The Peoples Pension or Now Pensions as well as other pension providers. It will provide all the regulatory data as required and will provide the information to meet the requirements laid down by the new legislation. Stage 8: Review Service Provide a review service at both scheme and member level, if required. 21

22 other areas of advice Protection The need for protection through life assurance is of paramount importance. How would your family cope after your untimely death? As Independent Financial Advisers, we can search the market for the most appropriate terms. Critical Illness and Income Replacement Insurance You are much more likely to suffer a serious illness than die before you retire and it could be a very worrying time. You and your family should not have to be concerned at the same time about loss of income. Pensions The state will provide! It will provide, but the provision is limited. Your employer may help, but what if you don t have a company scheme? Even if you do, will it give you enough to live on? Company Pensions Are you looking to set up a pension scheme for you and your employees? Maybe a Stakeholder or an Occupational Scheme? We can advise you on the most efficient route and the most appropriate provider to suit your requirements. Business Insurance Most prudent business people insure their business property cars, machinery, etc. Not many insure the most expensive asset of any business its people. Consider the effect on your business if you or one of your key employees were to die or become seriously ill. Share protection is vital if you are to safeguard the ownership of your business.

23 Savings We all have things we want to save for such as weddings, a world cruise, school or university fees or even a classic car. If you don t put money away in a regular, disciplined way, who else will? Investments Are you getting the most effective return on your investments? Unit Trusts, Bonds or Individual Savings Accounts (ISAs) could provide flexible, tax efficient means of saving via lump sums or regular monthly amounts. Mortgages Are you paying too much for your mortgage? Are you looking for a mortgage? There are many offers around today for loans and re-mortgages. Why not take advantage and perhaps save money? We use up-to-date technology to source the most suitable deal for you. Your home may be repossessed if you do not keep up repayments on your mortgage. We may charge a fee for mortgage advice. The precise amount will depend upon your circumstances and the amount borrowed, with a typical fee being 495. Equity Release Are you over 60 and would like to look into releasing the equity from your home? Releasing equity from your home might just be the answer to raising the money you require without you needing to move. It is a big decision and there are many aspects to consider, which is why professional advice is essential.

24 The next step If you have a trusted adviser to guide you through your responsibilities, you will have the peace of mind of knowing that your obligations in respect of auto-enrolment are fulfilled. If you are interested in becoming a client, or would like to learn more about our services, we would be delighted to hear from you. You can contact us in one of the following ways: 5 Bretton Hall Offices, Chester Road, Bretton, Chester. CH4 0DF Tel: Fax: info@wtkltd.co.uk WTK Financial Services Ltd registered in England No Registered Office: 5 Bretton Hall Offices, Chester Road, Bretton, Chester. CH4 0DF Authorised and Regulated by the Financial Conduct Authority, FCA No