Pension declaration of compliance explained

If you’re hiring staff, you’ll need to ensure you meet your legal obligations for your workplace pension. In the UK, this means completing a pension declaration of compliance with The Pensions Regulator. In this article, we'll help you understand the steps you need to take to complete your declaration of compliance and what happens if you miss your deadline.

What is the declaration of compliance?

The declaration of compliance highlights to The Pensions Regulator the steps you have taken to comply with your auto enrolment duties as an employer. You need to complete your declaration within 5 calendar months of your start date. Your start is the day your first member of staff joins the company.

All employers need to complete the declaration of compliance, even if no members of staff are auto-enrolled into a workplace pension scheme.

Why is the pension declaration of compliance required?

A declaration of compliance is required to show that you are meeting your auto enrolment duties. These duties can include:

• Confirmation of your staging (and re-staging) date
• Maintaining personal details of employees
• Keeping records of when contributions are paid
• Tracking requests to join or leave your workplace pension scheme
• Staying up to date with ages and earnings of employees

Failure to submit your declaration of compliance to The Pensions Regulator could result in a fine.

What happens if you miss the deadline? 

If you’ve missed a deadline, you should tell The Pensions Regulator as soon as possible. In addition, you should ensure that you communicate the process of automatic enrolment in writing with your staff and put them into a pension scheme. You may be required to backdate employer contributions for staff members or even pay staff contributions so that they do not miss out.

Non-compliance can have legal consequences resulting in penalty notices or for severe cases, prosecution.

What you'll need

Completing a declaration of compliance can take as little as 15 minutes, provided you have the required information at hand. You can use the declaration checklist to help you gather what you need. To get started, you’ll need:

• Your Government Gateway ID, login and password
• Your contact details including your name, address, telephone number and email address
• PAYE scheme reference
• Letter code from The Pensions Regulator
• Employer name and contact details
• Type of pension scheme
• Employer pension scheme reference

You can start the declaration of compliance provided you have received the letter code and PAYE reference from The Pensions Regulator.

How to complete your declaration of compliance 

To complete your pension declaration of compliance, create an account on The Pension Regulator’s Gateway or log in using your Government Gateway ID. It’s best to start as soon as possible. But, you don’t need to fill it out at once and you can save it as you go.

Ensuring that you fulfil your workplace pensions duties is a mandatory requirement and it’s crucial that you comply with legislation. Failure to do so could result in financial or legal consequences.

The Penfold workplace pension is designed to make auto enrolment effortless. To learn more, get in touch with our team of experts today.