I've just done my first autoenrolment payroll. They have done the pension set up and the letters etc so it's just setting the pension up in Moneysoft, downloading the file and uploading it on the PP website. How much are you charging for this?
Other clients want me to manage the whole process. How much are you charging for this? One off set up fee then ongoing bit extra on top of normal payroll?
I am charging a one-off set up fee and my monthly fees will be the same as the payroll fees, so if they pay £25 monthly for payroll then I am charging the same again.
I will also be using Moneysoft and hoping it will be smooth. I am not looking at AE as a profit generator, more fulfilling a need. However most of my clients stage in 2017 so maybe I will be really efficient by then and there will be something in it for me.
Initially I was just going to do an increase in payslip cost, but as all my payroll clients are also bookkeeping ones I've usually just tagged a small charge on to cover the time involved.
Thoughts at the moment are a monthly flat fee of £25 up to 10 employees with increments per 5 employees over that. I'm expecting/hoping that I can do a 10 employee payroll in an hour, the one I do at the moment takes me less than 20 minutes providing there isn't a new starter or leaver. That's not something I charge for at the moment but I think I'm going to have to start doing so for those who are AE to take into account the extra admin.
Really not sure on how much to charge for setup but I intend to offer a full service on that score. Without currently knowing the time involved its an unknown quantity and I've seen figures from others from £100 up to £500. Mine will definitely be no more than £200 but I'm hoping I can do it for £100 if possible.
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John
Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.
Good to see that you are involved helping clients with the Auto-enrolment of pension schemes. As an independent Financial Advisor I have been extensively involved with AE from the start. I have a number of large clients that I have helped with AE over the last 4 years.
Charging for the AE payroll service can be tricky as it depends how involved you get with the scheme ,payroll and the returns.
If its just the payroll aspect you are dealing with (no uploading to the pension scheme) then its probably best to charge a fee per member.
If the employer is looking for you to upload data, then this can be more complicated, especially as the employer has a duty of oversight on the scheme. I have found that if you are involved with the running of the scheme there is a tendency for the employer to pass the administration onto the party that is uploading the data. For us that is not a problem as we are regulated under financial services and markets act 2000 and we are registered with the FCA.
The pensions minister has recommended that AE administration should be classed as a regulated activity. Not sure how this will work in practice as it will pass more costs onto employers. Most employers see AE as another issue they have to deal with.
The one thing I would recommend is that Employers need to be reminded of their responsibilities and cannot pass this onto a third party. The more you are involved with AE the greater charge you should levy to cover time and risk to your business.
If you have any questions re AE please feel free to fire them across to me. More than happy to help if you have any AE issues
Regards
Graham Bond - Consilium Asset Management
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-- Edited by Shamus on Wednesday 9th of March 2016 11:53:20 AM
Are you saying that uploading the file produced by Moneysoft payroll software to the pension company's website is a regulated activity?
I read it that the pensions minister would like to class the admin as a regulated activity. Surely that's something they should have done from the start? AE has been with us for 4 years (I think) now. It's a bit, sorry, lot, stupid just when the micro employers are starting to come on board. I think I will need to research this, because theirs little point in me starting it if they're going to regulate it.
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John
Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.
So is the understanding that it can be processed by us, yet we can't advise which pension to use? I was always under the impression that most of our bodies advised against giving pension advise.
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Johnny - Owner of an overly-active keyboard.
A man who can read, yet doesn't, is in no way wiser than a man who can't.
I thought that if the employer chose the pension we were OK to do the admin of setting it up, doing the letters to employees and doing the file upload from the payroll system. If I'm wrong please can someone tell me before I actually do one of those. So far all I've done is upload one file, the rest of my clients don't start till next year. Thanks
I make an assumption that your line of thought is correct. I would hazard a guess that we are unable to suggest which pension to use. I could be wrong. My knowledge of this is not strong, so don't take my word for any of it.
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Johnny - Owner of an overly-active keyboard.
A man who can read, yet doesn't, is in no way wiser than a man who can't.
The expectation is that AE is going to be the next PPI.
The belief is that accountants will be protected from the fallout as they do not give advice themselves. However, if they advised the client on which advisor to see then they may be held jointly liable where it is deemed that the advice that the client receieved did not result in them being put in the best position at retirement (are advisors expected to have crystal balls!!!).
I do however agree with Princesses understanding in that provided that we have absolutely nothing to do with setting it up or even advising people on where to go to have it set up then the mere mechanical processing of AE was acceptable and without risk (beyond normal software and internet issues).
From the advisors point of view how do they protect themselves? If they advise through a limited company and think that folding the company will protect them they will be in for a surprise.
Will PII companies pay out when the bottom of the barrel ambulance chasing lawyers with no more PPI claims to chase get involved?
The only advice that I would give to anyone here would be to tell their clients to find a financial advisor. No names no matter how much referal fee the advisors try to throw at you... Its not worth it.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
There is more than sensible advice in that post Shaun. I've not looked too much into it yet myself as I've no need to atm. I'm hoping most of the creases will have been ironed out by then. The more legislation, rules etc they keep adding to businesses, limits what we can know. I said other day there are 17000 pages of tax code, turns out it's over 18000. I guess it opens more doors to specialise in one subject mind. Akin to how your GP refers to specialists.
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Johnny - Owner of an overly-active keyboard.
A man who can read, yet doesn't, is in no way wiser than a man who can't.
We are allowed to suggest to the employer what pension scheme to use but we are not allowed to advise employees in any way shape or form, unless authorised.
You (eg accountants, book keepers, etc) can provide investment advice to employers choosing a pension scheme, but you need to be authorised to provide advice to individuals. If you are concerned about what level of support and guidance you are able to give, read our page about your role in helping a client to choose a scheme.
I can't find any reference to Ros Altmann (or Steve Webb) wanting to make ae administration a regulated activity, so I would appreciate Graham Bond providing a reference, otherwise I think it's ok to ignore that particular remark Princess.
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John
Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.
