You must do this on your duties start date.
On your duties start date, you must work out how much each member of staff earns and how old they are. This will identify what you need to do and is known as 'assessing your staff'. You should use this information in order to complete your declaration of compliance.
Assessing your staff
Staff will fall into one of two categories:
| Gross Earnings | Age 16 - 21 | 22 - SPA* | Age SPA* - 74 |
|---|---|---|---|
| Over £833 a month (Over £192 a week) |
Type 2 | Type 1 | Type 2 |
| £833 a month or less (£192 a week or less) |
Type 2 | Type 2 | Type 2 |
*State Pension Age. If you are unsure what this is use the State Pension Calculator to find out.
Any staff who are:
- aged between 22 up to State Pension Age
- and earn over £10,000 per year, or £833 per month or, £192 per week
...must be put into a pension scheme and you must both pay into it.
We have additional information to help you understand your costs. You can also contact your pension provider should you require more information.
If any of your staff fall outside of the above age and earning criteria then you only need to put them into a pension scheme if they ask.
If you've worked out that you don't have staff to put into a pension scheme you still have other tasks to carry out in order to meet your legal duties. If you don't have any staff to put into a pension scheme you will still have to write to them to tell them how automatic enrolment applies to them.
What happens if my staff are not in a PAYE scheme?
If your member of staff earns £120 a week (£520 a month) or below, HMRC may not require you to set up a PAYE scheme. However, you do still have certain automatic enrolment duties:
- You must write to your staff to tell them how automatic enrolment applies to them
- If your staff then write to ask you to put them into a pension scheme, you must set this up for them, but you don't have to pay into it
When you start paying a member of staff more than £120 per week, you must set up a PAYE scheme with HMRC. You must also assess your member of staff to work out if they need to be put into a pension scheme that you also pay into. After you set up your PAYE scheme, we'll write to you and ask you to complete a declaration of compliance, which is where you tell us how you've met your duties, by a specific date.
Other things to consider
Employing staff on variable hours, contracts and pay
If you employ seasonal or temporary staff or you have staff whose hours and pay varies each time you pay them, you will still need to assess them to work out if they need to be put into a pension scheme.
Find more information to help you when you're assessing:
Postponement
You can delay 'assessing' your staff for up to three months. This is known as 'postponement'.
Postponement does not change your duties start date, but simply the day you assess your staff's age and earnings. If you use postponement you must write to your staff to tell them what you are doing. Find out if postponement is right for you.
Put staff into a pension
What do you need to do?
Having worked out what you need to do for each person you employ, it is now time to put those that you need to into a pension scheme.
You will need to give your pension scheme provider all the information that they need to initially set up your staff in the pension scheme.
Making contributions
You must work out how much you both need to pay into the scheme, and arrange for this to happen. Find out more about making contributions to your pension scheme.
Payroll software may help do this for you. For full details contact your pension scheme provider.
To do list:
- Work out what you need to do for each member of staff
- Send the details of staff who are being put into a pension scheme to your pension provider promptly
- Start paying contributions into your pension scheme