We recently received this question from a client: I’ve received letters from the ICO and the Pensions Regulator – do I legally have to do anything with these?
When running a company, you’re probably receiving quite a few letters – some from those selling their services, some official bodies with relevant and important information you need to act upon, but some could unfortunately be posing as said official bodies.
Of course, for those using a registered office address service, you may be shielded from some of the spam and forwarded on only what’s deemed relevant.
There are two letters in particular for which we at Integro are often asked “is this real?” and “what do I need to do?”. These are from:
- Information Commissioner’s Office (ICO)
- The Pensions Regulator (TPR)
Both are real and official bodies, and these letters shouldn’t be ignored. Receiving one does not necessarily mean you owe money or need to set up a pension, but you do need to check whether any action is required.
I’ll break down both to give you more of an idea of what to look out for, and what you need to do with them below.
Information Commissioner’s Office (ICO) Letters
The ICO is the UK’s independent regulator for data protection and freedom of information. They also collect the annual data protection fee from businesses and organisations that are required to pay it.
If you have recently set up a limited company, you may receive a letter from the ICO asking you to check whether you need to register and pay the fee.
How do I know if I should register with the ICO?
The ICO states that organisations which process personal data as a controller normally need to pay a data protection fee unless they are exempt.
There are exemptions where personal information is only being processed for certain purposes, including staff administration, your own marketing and PR, and your own accounts and records.
Whether you need to pay therefore depends on what personal data your business holds and what you do with it.
There is a wealth of information available on the ICO website which explains in detail the meaning of ‘personal data’. According to the ICO, ‘personal data’ has to be information that ‘relates to an individual’; and as such, establishing whether or not the information your company holds for clients, agencies or other contacts relates to an individual will be key in deciding whether you need to register with the ICO and pay the fee.
On their page What is the meaning of ‘relates to’?, there are some useful examples which may help.
It is your responsibility to establish whether the company needs to pay the fee, and the easiest way to check is to use the ICO’s data protection fee guidance and self-assessment.
The current annual fees are:
- £52 for tier 1 organisations – generally those with turnover of no more than £632,000 or no more than 10 staff.
- £78 for tier 2 organisations – generally those with turnover of no more than £36 million or no more than 250 staff.
- £3,763 for larger tier 3 organisations.
There is a £5 discount if you pay by Direct Debit. Most contractor companies which need to pay the fee will fall into tier 1.
If you receive a letter quoting your Companies House number and establish that your company is exempt, you can also tell the ICO online that you do not need to pay.
Whilst as Accountants, we cannot advise as to whether or not you need to register your company, speaking with the ICO should clear up any questions you may have.
Beware of scams…
Whilst the ICO is absolutely real, they have warned of scams from fake companies requesting payment of a data protection fee, be that over email, letter or telephone.
We’d advise that when making a payment to the ICO you only do this directly from their official website.
The Pensions Regulator (TPR) letters
TPR is the governing body and regulator for workplace pensions in the UK, working with and giving guidance to employers to ensure they meet their automatic enrolment responsibilities.
How do I know if this applies to me?
Any business which employs staff can have legal responsibilities under automatic enrolment.
The Pensions Act 2008 requires UK employers to put certain staff into, and contribute towards, a workplace pension scheme.
However, the rules are different for companies which only have directors.
If you are the sole director of your company and have no other staff, your company has no automatic enrolment duties, even if you are on the company payroll.
If TPR writes to you in those circumstances, you should tell them that you are not an employer using their online service. You do not need to set up a pension simply because you received the letter.
Where there is more than one director and no other staff, there will normally still be no duties if none of the directors has an employment contract, or if only one director has one.
If at least two directors work under employment contracts, automatic enrolment duties can apply.
If your company employs somebody who is not a director, the company will normally have employer duties even if that employee does not earn enough to be automatically enrolled.
Where your business does have duties, TPR may write to request PAYE scheme details or other information, stating when and how this needs to be provided.
TPR have a handy tool online; answer a few questions and they’ll advise on the next steps appropriate to you.
Can my accountant help with this?
The responsibility for meeting the legal requirements of auto enrolment lies with the employer (the Limited Company), so it should not be assumed that this is something your accountant will take care of.
That said, here at Integro we can assist with the submission, but only after receiving the reminder from The Pensions Regulator containing the relevant information.
We would not, as a matter of course, submit anything automatically without a prior conversation with our client and would advise that, where in doubt, you should always speak to your accountant.
