Payslips and pensions data – the law is changing
Dec 07, 2018
Key Dates Pensions
If you’re an employee, pay day is very important! It’s important to receive your payslips either on, or before, your scheduled pay day, and to know how much money you’re getting.
So if you’re an employer, pay day means ensuring your employees receive their pay slips on time, and also that they display these crucial figures:
- Your employees’ earnings, both before and after any deductions
- The value of any deductions which change each pay day, such as tax and National Insurance
- The value of any benefits they receive, such as season ticket loans
How the law around payslips is changing
From 6 April 2019, there is one other piece of information which you may need to include on your employees’ payslips. If you have workers whose pay varies according to the number of hours they work, then you’ll need to state on their payslip how many hours you’re paying them for.
Also, from April 2019 it will no longer be just employees who need to receive a payslip. If you employ agency staff, bank staff, casual staff or zero-hours staff then these workers will also need to receive an itemised payslip, either before or on their scheduled pay day. This is so they can get a clearer idea of what deductions are being made, and can check that what they’re being paid is accurate.
How to distribute payslips more easily
As an employer, you may be able to hand-deliver your employees’ payslips, or you may have to rely on sending them in the post. These days there’s a third option – you can save both the printing and postage costs of paper payslips by sending your employees an electronic payslip instead.
If you use payroll software this can make life much easier for you – as well as ensuring all the vital information is included, it also guarantees that your employees’ payslips are sent out on time each week or each month, directly to their email inbox.
A change to pensions data
If you’ve set up a workplace pension for your employees, then each pay period you need to send their pension data to your pension provider. As an employer you have a requirement to provide this information, so your pension provider can check that you’re complying with the government’s rules of minimum contribution levels.
From 6 April 2019, you’ll also need to send your employees’ pensionable earnings to your pension provider, along with the rest of their data. Pensionable earnings are the amount you use to calculate pension contributions, and providing this additional information is intended to help identify employers who aren’t meeting the minimum contributions levels, so they can avoid being fined by the Pensions Regulator.
How to provide pensionable earnings data
If you already use payroll software to calculate your employees’ pension contributions you probably don’t need to do anything. Your payroll provider will liaise with your pension provider and will start to automatically capture employees’ pensionable earnings from April 2019.
If, however, you send data to your pension provider to be completed manually, you’ll need to use a new file template to ensure that from April you’re also including your employees’ pensionable earnings. If the data you send doesn’t include this information then your pension provider won’t be able to accept it.
As the number of employer obligations continues to increase, now is definitely a good time to consider adopting payroll software to speed up the process of paying your employees. The PT team can make life easier still, by doing all the hard work for you – chat to us about our payroll service which can save you both time and headaches!