Discover if you are exempt from auto-enrolment (and how to opt-out!)

Published: Thu, 11/05/15

Hi

Pension auto-enrolment is slowly becoming a reality for the UK’s smallest companies, with the vast majority of small businesses required to be operating pension schemes by early 2017, and every business in the country required to be auto-enrolled by early 2018.

Unlike large or medium-sized businesses with hundreds of employees, freelancers, contractors and micro-businesses may be exempt from pension auto-enrolment. If your company has employees – even one – you are legally required to operate a pension scheme.

However, if your business is comprised only of directors you are not legally required to operate a scheme. Many director-only businesses already operate private pension schemes so declaring your company exempt will make sure you have no bureaucratic hoops to jump through, and you can continue your pension contributions as normal. However The Pension Regulator will not know you are exempt – so they need to be told!

To opt-out you must inform the Pension Regulator that your company is exempt by emailing customersupport@autoenrol.tpr.gov.uk using the following template:

1. I confirm that [My Limited Company Name] is a not an employer for the purposes of automatic enrolment for the following reason – (select one option from the list below):

    a) There is only one director and there are no other staff working for the company
    b) The only people working for the company are directors and none of them has an             employment contract

    c) The only people working for the company are directors and only one of them has an             employment contract

    d) The company has ceased trading (including date ceased)
    e) (if there is some other reason why you believe you do not have any automatic                     enrollment duties, please provide a brief explanation)

2. The letter code for the company is: [The letter code is a 10 digit number which can be found on all letters sent from The Pensions Regulator]

3. The PAYE scheme(s) reference is: [xxx/xxxxxxx]

4. The Companies House registered number is: [xxxxxxxx]

5. The name, email address, address and telephone number of contact at the company.

If you have any queries please do not hesitate to get in contact.

The Pension Regulator should then confirm your exemption.


Noel Guilford


Noel Guilford is the principal of Guilford Accounting a small business accountancy practice specialising in advising owner-managed businesses on current accounting, finance, and tax matters. You can reach him via email at noel@guilfordaccounting.co.uk or by phone at 01244 660866. He is the author of the best selling book 'Figure it out - an entrepreneurs guide to understanding your business numbers' which you can obtain by visiting http://guilfordaccounting.co.uk/figureit out. His forthcoming book 'Know your business numbers' will be published December.