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Are charities really prepared for auto enrolment?

The law on workplace pensions has changed and by 2017 every organisation in the UK, including charities, must automatically enrol their employees. The ability of pension providers to provide solutions is becoming a real issue of capacity and, if you do not start preparing early, the cost of auto enrolment (which is your legal obligation) will soon build up.

Thousands of charities are approaching their staging date

As an employer you are responsible for enrolling all eligible employees into your scheme (and contributing to it). There are thousands of charities approaching their staging date, as the below table (a rough estimate) shows:

Charities auto enrolment staging dates

Do not underestimate auto enrolment duties – are charities really prepared for auto enrolment?

Over 80% of charities will be approaching their staging date and will automatically enrol between now and April 2017. However, despite the national media coverage and breath of information available the concerns remain over whether or not charities are prepared, as Nigel Smith, Director of Hawsons Wealth Management, explains:

“I think some charities are underestimating how complex auto enrolment is and how much work is involved. There are a number of tasks you must complete before your staging date and we advise charities to start preparing nine months – ideally twelve – before this date.”

“Some charities that already have workplace pensions in place might assume that their existing scheme will meet minimum criteria, but this is not always the case. In fact, in the majority of cases it does not. The ability of pension providers to provide solutions is also becoming a real issue of capacity and if charities continue to delay their auto enrolment preparations they will likely be charged a more expensive service fee. Adding this cost to the potential fines charities could receive, at a minimum of £400, and the costs of auto enrolment can soon add up for those that wait.”

For more details and advice please come to one of our free auto enrolment seminars.

More from our charity experts

You can find all of our latest charity sector news and newsletters here.

If you are looking for advice in a particular area, please get in touch with your usual Hawsons contact.

Alternatively, we offer all new clients a free initial meeting to have a discussion about their own personal circumstances – find out more or book your free initial meeting here. We have offices in Sheffield, Doncaster and Northampton.

Nigel Smith is responsible for the Wealth Management company within Hawsons, providing Independent Financial Advice to individual and corporate clients.  For more details and advice, please contact Nigel on [email protected] or 0114 266 7141.

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