Transcript of video on how to use payroll software for automatic enrolment.
Welcome to The Pensions Regulator's introduction to payroll for automatic enrolment.
We recognise that having the right payroll software can help your clients manage their automatic enrolment duties, as it can automate many of the tasks which will need to be done every pay cycle, like assessing members of staff.
Your client will need to ensure that they give their pension provider accurate and up to date details on their staff such as their name, address, earnings and date of birth. Payroll software should be set up to hold these details for all staff.
This information needs to be kept up to date to ensure that the right people are enrolled into the pension scheme and contributions are paid correctly.
Your client's pension provider will need to receive this information in a specified format in order for it to be processed correctly.
Some payroll software can automatically send this information to the pension provider without the need for you to upload or email a file. You should check with your client's payroll provider if their software can do this and how to set this up.
Payroll software can also calculate how much your client and their staff will need to contribute each pay period and then ensure that the correct tax relief is calculated.
You or your client should check that the software is set up to use the correct tax relief method that your client's pension scheme uses.
Your client may have to manage requests from any staff who ask to opt in or join the pension scheme, as well as stopping deductions and processing refunds for any staff that opt out of the scheme.
As well as calculating earnings and storing staff data, payroll software can also help with other tasks. For example, it can generate the letters that employers need to give their staff as part of their legal duties. It may also have the flexibility to adjust the postponement period to suit different pay cycles.
If your client's payroll software can't do these tasks, they may want to consider upgrading or changing it - or speak to the pension provider to see if they can do some of these tasks instead.
If your client does not currently use any payroll software, or uses HMRC's Basic Pay As You Earn Tools, then they will need a separate process to assess staff and calculate contributions.
You can find more information on our website to do this, including a downloadable basic assessment tool to help with this process.
We recommend you or your client carry out a test with the payroll software before your client's staging date. Most pension providers will have testing facilities. This will give you time to resolve any problems between the employer, software and pension provider that might come up.
We have more information, resources and guidance available on our website to help you with automatic enrolment, including our 'quick guide to setting up payroll.'