Key tax dates and deadlines for 2018/19
It is an inevitable reality that, for anyone earning a livin...
By Jonathan London on 27th March 2015
As a result of a number of our clients recently receiving communications from the Pensions Regulator, we’ve put together a quick guide to auto-enrolment for contractors. All contractors, freelancers and locums operating through a Limited Company will need to take action when they receive notification confirming their ‘staging date’ for complying with Auto-Enrolment. So whether you’ve already received a letter, or have yet to do so, read on to see what you’re going to have to do in order to comply with the new legislation.
Due to changes in the law on workplace pensions, every single employer with at least one member of staff is obliged to enrol them into a workplace pension scheme and contribute towards it – this is Auto-Enrolment.
There are various stages which you will need to go through – and failure can mean that your company may be subject to a fine.
You can find more guidance here: http://www.thepensionsregulator.gov.uk/employers, but we’ve put together the following advice for you with your options on how to proceed.
If your company meets one of the following criteria, you can choose to opt your company out of automatic pension enrolment.
If this is the case and you want to opt your company out, you can opt out by following this link and completing the form on the Pensions Regulator website. Simply enter your details where instructed – you’ll need your original Letter Code and PAYE reference.
If you employ your spouse, and they are not a director – you cannot opt out of auto-enrolment.
If your circumstances change so that there are at least two people working for you under contracts of employment (whether directors or other staff), you’ll need to inform the Pension Regulator of this as soon as possible.
If you have employer duties or you want to go through automatic enrolment – you will need to nominate a contact (there is a deadline!)
|Monthly Gross Earnings||Age||Weekly Gross Earnings|
|From 16 to 21||From 22 to SPA*||From SPA to 74|
|£481 & below||Has a right to join a pension scheme||£111 & below|
|Over £481 up to £833||Has a right to opt in||Over £111 up to £192|
|Over £833||Has a right to opt in||Auto Enrol||Has a right to opt in||Over £192|
Figures correct as of 2014/2015. *SPA = state pension age. Further guidance is available here.
Whilst, if you are one of our clients, we can assist you with the process of complying with Auto-enrolment, responsibility for complying with the duties ultimately lies with the employer, and cannot be passed to us.
Some of you may already be contributing to a company pension scheme. This is a cost that is an allowable deduction for corporation tax and allows you to decide to continue drawing a low salary to reduce your national insurance, without missing out on the lucrative tax savings associated with pension investment.
If you’d like to set up a company pension, you should speak to a Financial Advisor for advice specific to your circumstances.
Contractor Wealth, in association with CMME, is a Financial Advisor who specialises in pensions planning for contractors.
Just get in touch with the team here at Boox, and give us your consent to pass your information through to Contractor Wealth. Any information or advice provided by CMME will be entirely independent of Boox and be specific to your circumstances. You are free to raise any questions at any time, and are under no obligation to obtain advice or use their services.
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