Payroll News – Latest
New National Minimum Wage rates
National Minimum Wage rates increase on 1st April 2017. Over 25 year olds to £7.50, 21-24 year olds £7.05, 18-20 year olds to £5.60 and 16-17 year olds to £4.05, the apprentice rate to £3.50.
Advisory Fuel Rates
The advisory fuel rates changes on 1st March 2017. The rates are used to repay employees tax-free for fuel used on business mileage. They only apply where employers reimburse employees for business travel in their company cars or require them to repay the cost of fuel used for private travel. Click here for the new rates.
No penalties for short filing delays
Employers will not incur penalties for delays of up to three days in filing RTI information from March HMRC has announced.
New Marriage Allowance
From 6th April 2015, if you are married or in a civil partnership you can now transfer £1,060 of unused personal allowance from one spouse or civil partner to the other. It will save the couple tax of £212 for 2015-16. The marriage allowance can only be claimed where one person has unused personal allowance and the other partner is taxed at no more than 20%. The claim must be done online through the GOV.UK website by the person transferring their allowance.
Penalty Filing notices for late RTI reporting now in force
Penalties came into force on 6 October 2014 for businesses with schemes of 50 or more employees. Those affected will receive a letter outlining the penalties incurred for October to December quarter 2014. HMRC issues a penalty when the Full Payment Submission (FPS) is late, it has not received the expected number of FPSs or when it has not received an Employer Payment Summary if no employees have been paid in a tax month. The largest employers can face charges of up to £400 a month. Penalties will also start in March 2015 for those with 49 or less staff where fines are limited to £200 for between 10 and 49 staff and £100 for 9 or less. Each penalty on the notice will carry an identification number and details of the procedure to follow if they want to appeal.
P35 declaration no longer mandatory
HMRC have said that the tax year end P35 questions are no longer required for the 2014-15 tax year end procedure.
Abolition of employers’ NI for under 21’s
From 6th April 2015, employers will not have to pay Class 1 National Insurance contributions for employees under 21 years of age. This is restricted to earnings up to the Upper Earnings Limit which is expected to be £813 per week for the 2015-16 tax year.
New rights to time off for ante-natal appointments
From 1st October 2014 an employee who is the partner of a pregnant woman is entitled to take time off during working hours so they can accompany the woman when she attends an ante-natal care appointment. This is limited to no more than two appointments, with the maximum time off during working hours for each appointment being no more than 6.5 hours.
Holiday pay ruling
Where an employee’s salary includes regular sales commission, that commission must be included in holiday pay according to the latest ruling by the European Court of Justice. This concerns the four weeks statutory minimum holiday, not the 5.6 weeks granted in the UK. The court has held that workers must not be discouraged from taking annual leave. Therefore holiday calculations should include an allowance for commission to prevent workers from suffering any disadvantage. Employers should consider the implications of this outcome and undertake a review of their contracts and policies to ensure it is clear how holiday pay is calculated.
Flexible Working Regulations
The new provisions came into force on 30th June 2014. They extend the right to make request for flexible working to any employee who has been employed for 26 weeks, not just to certain parents and carers as is currently the case. More than 25% of British workers are likely to make a flexible working request.
Interest on late HMRC payments
HMRC now charges interest on any late PAYE and Construction Industry Scheme payments.
For employers that pay monthly, the first payment of the 2014-15 tax year was due 19th May or 22nd May if paying electronically. From the date the payment is due to the date it is paid in full, HMRC will charge interest daily. To avoid an interest charge employers should pay by the due date the amounts reported on their Full Payment Submission (FPS) less any deductions reported on an Employer Payment Submission (EPS) if applicable.
Maximum Penalty for illegally employing an immigrant doubles
From 14th May, the Immigration Act 2014 increased the maximum penalty from £10,000 to £20,000 per illegally employed worker. This applies where an employer is found to have employed workers who are subject to immigration control but do not have the right to work in the UK,
£2000 Employment Allowance
The Employment Allowance is available from 6 April 2014. If you are eligible you can reduce your employer Class 1 NICs by up to £2000 each tax year. You can claim your allowance through your payroll software or HMRC’s Basic PAYE Tools. Your employer Class 1 NICs payment due is reduced by an equal amount of employment allowance, but no more than £2000 per year. From April 2016 the amount is raised to £3000 pa but single director companies are now exempt.
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Payroll News from Highland Payroll Services