The accountancy and business advisory firm PKF has said small businesses will now have more time to comply with the new pension rules that will force businesses to enrol their employees in a pensions scheme and make contributions. The hospitality industry, in particular, will benefit from the rule changes, PKF says.
The revised staging dates mean companies with fewer than 250 employees will have more time to consider how the new regulations will affect them and to calculate how much the changes will cost them in contributions and administrative charges.
Simon O'Reilly, an employee benefit consultant in PKF's Financial Planning team, said: "The leisure industry is one of the main beneficiaries of these new rules. Although many independent bars, restaurants and hotels were hoping for a full exemption given the tough trading conditions, the extended deadlines will still be a welcome relief to most, providing them with extra time to budget for increased pension obligations.
Although more details on the auto-enrolment rules are not due back to the Pensions Regulator for a number of months, O'Reilly said businesses should use the extra time wisely.
"Despite the revised timetable, the deadlines remain challenging and businesses should not rest on their laurels. Bosses should use this extra time to understand and plan for the major additional administrative and financial burdens that will be placed on them by these regulations," he said.
While large employers will see no changes to the dates when they must comply and will see auto-enrolment begin in October, small businesses who might struggle most with the changes have been given more time. Hospitality companies with 50-249 employees will see their auto-enrolment begin in April 2014 whereas those with 30 staff or less have until January 2016.
In November 2010 after the new rules were announced BigHospitality reported The Federation of Small Businesses (FSB) had said hospitality businesses faced “extortionate” costs when the new regulations came into force.
Under the new rules employers will have to enrol their employees in a pension scheme and make minimum contributions to it of 3 per cent. The level of pension contributions will be phased in over time with full contributions having to be paid from October 2018.