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4 important deadlines for small businesses in 2016

13 Jan 2016

Happy New Year! The start of 2016 is a great time for SMEs to make strategic plans for the year ahead – especially as there are some important deadlines looming that will impact your company over the next 12 months.

For small businesses in particular, where resources are under intense pressure, preparation is key in adapting to changing legislation. Here are 4 major regulation changes that all SMEs will need to embrace and address in 2016:

1.      New card machines must have contactless capabilities

Deadline: 1st January 2020

Back in Autumn 2014, MasterCard issued a mandate requiring all business that accept either MasterCard or Maestro card payments to switch over to contactless-enabled terminals by 1st January 2020.

Starting from January 2016, New point of sale (POS) terminals installed by a business must adhere to this standard – meaning small businesses investing innew card payment technology need to ensure their machine can accept both contactless payments and Near Field Communications (NFC) mobile payments, such as Apple Pay.

2.      Apprentices have greater rights under Enterprise Bill

Deadline: tbc

The government’s 2015 budget included a number of support mechanisms for small business, such as the introduction of a Small Business, Enterprise and Employment Act – designed to remove some of the red tape constricting company growth.

Several new regulations have already been rolled out as a result of this act, and 2016 will see even more changes brought into force, affecting both SMEs and employees. These include an Enterprise Bill, which will offer new protection for apprentices.

Under the Enterprise Bill, businesses offering apprenticeships will need to provide at least 30 hours’ work per week at the minimum national wage, alongside on-the-job training.

3.      Employers will be required to pay a new National Living Wage to over 25s

Deadline: 1st April 2016

Another significant term of the Small Business, Enterprise and Employment Act is the introduction of a new National Living Wage in the UK.

This means that, from April, companies will need to pay employees aged over 25 years at least £7.20 per hour – rising year-on-year to £9 per hour by 2020. For younger workers, the minimum wage will rise to £3.87 per hour among 16-17 year olds and £5.30 per hour for 18-20 year olds.

More than 1,600 companies signed up to the scheme voluntarily when it was announced last year, to adjust to these new requirements before they become mandatory. In order to help foot the increased wage bill, the government has offered businesses a 2% cut in corporation tax by 2020 and a 50% reduction in National Insurance contributions up to £3,000.

4.      Small businesses will need to offer employees a pension scheme

Deadline: multiple

As we mentioned in a previous blog – workplace pensions: what do small businesses need to know? – by April next year, companies of all sizes will be required to provide employees with a workplace pension scheme.

The deadline for the introductions, known as staging dates, is staggered, and therefore many SMEs will need to offer workers automatic enrolment prior to the 2017 deadline. Here are all the small business workplace pension deadlines for 2016:

1st January 2016 - companies with fewer than 30 employees with PAYE reference numbers ending in 02-04, C1-C9, D1-D9, CA-CZ, DA-DZ

1st February 2016 - companies with fewer than 30 employees with PAYE reference numbers ending in 00, 05-07, E1-E9, EA-EZ

1st March 2016 - companies with fewer than 30 employees with PAYE reference numbers ending in 01, 08-11, F1-F9, G1-G9, FA-FZ, GA-GZ

1st April 2016 - companies with fewer than 30 employees with PAYE reference numbers ending in 12-16, 3A-3Z, H1-H9, HA-HZ

1st May 2016 - companies with fewer than 30 employees with PAYE reference numbers ending in I1-I9, IA-IZ

1st June 2016 - companies with fewer than 30 employees with PAYE reference numbers ending in 17-22, 4A-4Z, J1-J9, JA-JZ

1st July 2016 - companies with fewer than 30 employees with PAYE reference numbers ending in 23-29, 5A-5Z, K1-K9, KA-KZ

1st August 2016 - companies with fewer than 30 employees with PAYE reference numbers ending in 30-37, 6A-6Z, L1-L9, LA-LZ

1st September 2016 - companies with fewer than 30 employees with PAYE reference numbers ending in N1-N9, NA-NZ

1st October 2016 - companies with fewer than 30 employees with PAYE reference numbers ending in 38-46, 7A-7Z, O1-O9, OA-OZ

1st November 2016 - companies with fewer than 30 employees with PAYE reference numbers ending in 47-57, 8A-8Z, Q1-Q9, R1-R9, S1-S9, T1-T9, QA-QZ, RA-RZ, SA-SZ, TA-TZ

It’s worth noting that deadlines are based on the number of people employed by a business on 1st April 2012, as this is when the scheme was finalised. Check The Pension Regulator’s website to confirm your exact staging date.