Pension enrolment warning for small firms in Northumberland

Many small employers approaching their pension auto-enrolment staging dates are underestimating the amount of data needed, warns financial advice firm Lighthouse Group.

Pensions expert Roger Sanders said: “Many businesses in Northumberland lack the information on employees vital to completing enrolment smoothly.”

“Firms that leave their enrolment preparation too late will be in for a shock when they discover years of payroll and employee data need to be sorted before they can properly begin.”

Small businesses are advised to begin the process at least six months before their staging date, starting with checking what data their payroll function holds and how to export it, as well as what information is missing and must be tracked down.

Mr Sanders added: “The data challenge doesn’t end once everything is in place.

“Businesses also need to run a data check for every pay period, to verify employees’ eligibility criteria, new joiners and contribution levels.

“This will ensure that any employees who become eligible later are enrolled – for instance, because their earnings have increased or they have reached the age of 22.

“Automating as much of the data-gathering, collating and transmissions as possible will significantly lower both the margin for error and the overall cost to the business.

“Choosing a pension provider that offers locally-based support in person as well as from an administrative centre will also make all the difference.

“While there may be a small additional cost, being able to concentrate on running their business while knowing they are meeting the requirements, and are therefore unlikely to be fined, can make it worth every penny.”