New research from the Chartered Institute of Payroll Professionals (CIPP) has found that auto-enrolment has led to increased costs for almost 70 per cent of the businesses already complying, so small firms that have yet to stage should be aware there will be additional costs when they do.
A spokeswoman for the CIPP said it is not surprising that auto-enrolment is costing businesses money, as many have used the opportunity to upgrade software and systems to automate as much as possible.
She added that, as small businesses continue to stage over the coming weeks, months and years, the CIPP expects that they will use payroll agents to ensure they comply with their duties, but they should be aware that there will be additional costs whatever they do.
The results of the study were announced as the CIPP launched National Payroll Week earlier this month, which CIPP chair, Eira Hammond, said was an opportunity for the Institute to showcase the ‘complex, and often misunderstood world of payroll.”
She added that young people do not seem to understand the significance of a contract of employment or whether one had been signed, nor how to read their payslip or be able to decipher what had been paid and whether it was correct or not.
With over £280bn contributed to the UK economy through the collection of income tax and National Insurance, National Payroll Week is a reminder for businesses to educate their staff about financial awareness and the benefits of schemes such as payroll deduction, as this can be an effective alternative to other forms of lending and saving.
As one CIPP member put it, payroll contributes a great deal to the economy each year, so it is important that people are made aware of this and how by managing their financial affairs they can lead a productive and worry-free life.