Work Place Pension Charges

[Jessica@WhiteFieldTax]

Whilst NEST is free, that's an irrelevance. What is not free is the time value of doing

(a) declaration of compliance
(b) nominating a scheme
(c) communicating with eligible employees
(d) dealing with opt outs assuming all employees opt out, and you cannot coerce them to do so.

A one person or one person and spouse company (typically a "PSC") with no other employees generally can opt out of the whole shenanigans, a to d above, with a simple email to TPR.

In your case as you have non officer employees, you can't wholesale opt out of Auto Enrollment, and therefore the choices are:

- You do it
- your accountant / payroll bureau does it and charges
- your accountant / payroll bureau does it and absorbes the cost

And that is a commercial issue of course, and one for negotiation.

For OP, if there are no regular deductions then a monthly fee seems possibly unfair, although without knowing the details it may be that the provider has decided not to charge on a transactional basis and just to inflate all charges to cover cost of AE - there is some merit in that if it's fair and equitable across their whole client base.

My advise to OP is to ask the provider to justify the charge and work, and, if so inclined, seek to negotiate to reduce costs and do some if it in house, or have a fixed set up fee. However if the provider has simply inflated all costs across the board on a simple employee number stratified tariff, then the answer may be no.

[SueEllen]

I spoke to the Pension Regulator last week and we do qualify for auto enrolment, so our accountant was right.

That 5 employee rule is pre staging date. After the staging date its auto enrolment

Quite happy with my accountants advice just a little concerned about charges hence my original post!

The situation is made complex by you regarding the officers of your company as employees. (You have to very careful of the language you use when discussing a company that is used for contracting.)

The majority don't so are exempt from auto-enrolment and just had to send a letter in.

Anyone Lance has pointed out you can do it yourself.

[Bert007]

Auto enrolment | Business Advisers | Working out your client's costs | The Pensions Regulator

Also found this link

[Bert007]

I saw that about the NEST charges being free.

My accountant advised me there is still a monthly extra fee even if you opt out. This covers the software fee, which is a monthly charge, and time for the set up and advice regarding auto enrolment.

Quite happy to pay if they are doing work for me otherwise why should I.

[Lance]

I spoke to the Pension Regulator last week and we do qualify for auto enrolment, so our accountant was right.

That 5 employee rule is pre staging date. After the staging date its auto enrolment

Quite happy with my accountants advice just a little concerned about charges hence my original post!

from Nest's website

"It’s completely free for employers to use, with no charges to set up NEST or for ongoing administration."
NEST's charges I What is NEST I NEST Pensions

[Bert007]

I spoke to the Pension Regulator last week and we do qualify for auto enrolment, so our accountant was right.

That 5 employee rule is pre staging date. After the staging date its auto enrolment

Quite happy with my accountants advice just a little concerned about charges hence my original post!

[SueEllen]

I would suggest you go to or Google The Pensions Regulators website yourself rather than leaving it to your accountant.

Then phone them up to clarify whether you can just opt out without setting anything up, and what letter you need to send to them.

There have been one or two other posters with another company officer who were told they could opt out without setting anything up.

As if neither company officer has a written employment contract with the company they aren't employees. Yes you can pay company officers by PAYE but that doesn't mean the person is an employee. The reasons for this are complex.

[Lance]

The 5 employee limit thing is wrong. That is the current situation, once your staging date is reached auto enrolment kicks in if you have even one employee.

https://www.unbiased.co.uk/news/a-gu...-for-smes/1489

Thank you. Wasn't aware of that.
It still is something the OP doesn't need to do (not yet anyway).

[TheCyclingProgrammer]

The 5 employee limit thing is wrong. That is the current situation, once your staging date is reached auto enrolment kicks in if you have even one employee.

https://www.unbiased.co.uk/news/a-gu...-for-smes/1489

[Bert007]

my payroll is my accountants and they are the people who have given me the advice and they should know what they are talking about (we pay enough for there services!) What's annoying me is having to pay for a service that we will cancelled but happy to pay for work done up to that point.

I think I will google the 5 employee as I was told we qualified to offer the pension to our employees ... over 22 but below pension age and earn more than £ 833 per month

If you have time can you forward me a link re 5 employees ... thanks

[Lance]

Just curious what people were being charged for with regard to setting up of the workplace pension.

We are being offered NEST by the people that do our payroll or we could source our own provider. No employees are interested so we have been advised to opt in then opt out. But our out sourced payroll are still going to charge us every month for this workplace pension service even though I presume there is nothing to do, as the NEST membership would of been cancelled!

When I queried this and said the membership would of ceased I was told it was to cover all the initial set up costs... declaration of compliance, advice, software admin etc ...!

We are not being charged a one off set up fee just an extra amount on top of our monthly fee per employee on top of our usual fee, which in fairness to us could go on for years!

I suppose my next option would be to ask for a set up fee that's why I was interested what other peoples situations are.

If you have only 2 employees, neither of whom want a workplace pension then instruct your payroll people to stop and not charge a penny. The 2 employees can do what they want.

Let's be clear though. You really should seek professional advice and your payroll company are NOT professional advice, in fact they may well be worse than the advice you get for free on here.
For example, have they told you that you have no need for an auto-enrol pension for a company with less than 5 employees? They should have.

[northernladuk]

Dunno then sorry. Not sure many of us use the service you do so we opt out (or whatever the term is) and carry on as normal.

[Bert007]

That would be helpful!

Limited company, employees x 2 ... 1 director and 1 company secretary, PAYE and we use an accountant payroll service. Thank you

[northernladuk]

Bit of background would be nice. Are you umbrella? Permie? PAYE with agency?

[Bert007]

Just curious what people were being charged for with regard to setting up of the workplace pension.

We are being offered NEST by the people that do our payroll or we could source our own provider. No employees are interested so we have been advised to opt in then opt out. But our out sourced payroll are still going to charge us every month for this workplace pension service even though I presume there is nothing to do, as the NEST membership would of been cancelled!

When I queried this and said the membership would of ceased I was told it was to cover all the initial set up costs... declaration of compliance, advice, software admin etc ...!

We are not being charged a one off set up fee just an extra amount on top of our monthly fee per employee on top of our usual fee, which in fairness to us could go on for years!

I suppose my next option would be to ask for a set up fee that's why I was interested what other peoples situations are.