Charity Finance Group has released step-by-step guidance urging small charities to plan early and budget for additional costs created by auto-enrolment.

The guidance, Auto-enrolment for small charities: what you need to know, was produced by CFG in partnership with Premier Pensions, and aims to support the more than 20,000 charities estimated to be auto-enrolling their staff between 1 January 2016 and 1 April 2017. It aims to help charities to prepare, implement and build processes for auto-enrolment.

This follows the introduction of auto-enrolment by the government in October 2012. It ensures that all employers are obliged to automatically enrol their eligible employees into a workplace pension and contribute towards their retirement.

The key messages from the guidance are that charities need to plan early, communicate clearly with trustees and staff about the actions being undertaken and make sure that organisations budget for additional costs created by auto-enrolment.

It also says charities should not assume that its current pension scheme will be compliant with new regulations or that its current provider will offer a qualifying scheme.

The guidance “helps charities get ready for auto-enrolment, identify processes that they need to prepare and ongoing actions that they need to carry out”. It also contains three case studies from charities, outlining how they have been preparing for auto-enrolment.

Anjelica Finnegan, senior policy officer at CFG, said: “Our conversations with charities that have already auto-enrolled show that it is vital that charities start thinking about auto-enrolment well in advance of their staging date.

“This is especially true for small charities as they face particular challenges around securing compliant pension schemes and adsorbing the planning and administration costs. This useful guide is specifically designed to demystify auto-enrolment for small charities and guide them through the process step-by-step.”

CFG said it received numerous requests for guidance from small charities to support them with this process. It builds on CFG’s existing guidance Auto-enrolment for charities: a how-to guide.