Archive for July, 2010

A year has 365 days or, in a leap year, 366 days.  That means that there are 52 whole weeks, plus an extra one or two days. In a tax year that has 365 days, the first day and the last day fall on the same day of the week.  If, say, the first payday [...]

Two government initiatives are considered this week.  The first is the new Office of Tax Simplification which is tasked this year with reviewing tax reliefs and the taxation of individuals who operate as limited companies.  The IR35 legislation has been controversial from the start and is almost too complicated to explain, let alone operate. The [...]

On 20 July, the Government announced the establishment of the Office of Tax Simplification (OTS), as promised in the Conservative Party manifesto.  The responsibilities of the OTS are to identify areas where complexities in the tax system for both businesses and individual taxpayers can be reduced and to publish its findings for the Chancellor to [...]

On 22 June 2010, the Upper Tax Tribunal, in the case Mason v HM Revenue & Customs, rejected an appeal brought by Mr. Mason against the Special Commissioner’s unfavourable decision in October 2008 respecting his SERPS payments. Mr. Mason worked for 15 years on the North Sea oil rigs, between 1983 and 1998.  On retirement, [...]

UK employers of foreign national employees coming to work in the UK may be paid net cash earnings and non-cash benefits on the basis that the employer undertakes, using modified PAYE arrangements, to meet the UK tax liabilities involved and ensure that the employees’ tax affairs are handled by someone experienced in tax equalisation procedures. [...]

On 22 July, the Department for Environment, Food and Rural Affairs (DEFRA) announced reforms to 30 of its public delivery bodies. Included in the reforms is the abolition of the Agricultural Wages Board for England and Wales. There are currently three Agricultural Wages Boards; for England and Wales, for Scotland and for Northern Ireland. They [...]

Is an employee entitled to SSP if the employer deliberately does not pay wages during the relevant period and is later forced by a tribunal to make the payments?  The answer is disturbing. Two Finance Acts in one year is not an unusual situation but it looks as if there will be three Finance Acts [...]

An employee is not entitled to SSP if the employee’s average earnings in the eight-week relevant period prior to the payday before the first day of the period of incapacity is less than the NICs lower earnings limit (currently £97 per week/£421 per month). But what happens if an employee receives no wages during the [...]

A new schedule of allowances for magistrates (Justices of the Peace) in England and Wales, who are not paid for their absences by their employers, took effect from 1 May 2010.  However, the financial loss allowances are unchanged from those that took effect from 1 May 2009. Self-employed Magistrates Employed Magistrates to 30/4/10 from 1/5/10 [...]

The Government announced at the June Budget that it will end the effective requirement to purchase an annuity by age 75 from April 2011.  On 15 July, HM Treasury published a consultation document that sets out proposals to simplify the treatment of retirement savings and reduce complexity for individuals and for pension and annuity providers. [...]

The Government has published draft legislation for a further Finance Bill that will be introduced to Parliament in the autumn.  The Bill consists mainly of technical tax measures inherited from the previous government and the purpose of publishing the details now is to obtain comments on whether or not the legislation will work as intended. [...]

Many employers have workers who are called “casual” workers.  These are often people who do not work regularly but who are called on when the employer has the work, perhaps during the summer season, over Christmas, at harvest time, or at other times of peak production or trading.  These are not casual workers for PAYE [...]

The Scottish Agricultural Wages Board (SAWB) has proposed the following increases in the minimum hourly rates payable from 1 October 2009, from £5.80 to £5.96 per hour for those in their first 26 weeks of employment, from £6.32 to £6.51 for those employed for more that 26 weeks by the same employer, and from £3.50 [...]

The income tax legislation provides a number of tax exemptions for benefits provided to disabled employees.  These include: calculating the taxable value of a car with automatic transmission, which is provided for personal use as if it were a manual transmission car, in respect of its list price and its CO2 emissions figure, and accessories [...]

At their July 2009 meeting, the States approved an increase in pension age from 65 to 67 commencing in 2020. Although the detailed legislation has not yet been approved, the Social Security Department has issued the table below to show how it is intended to phase in the increase in pension age. Date of birth [...]

One of the basic principles of PAYE is that, when an employee moves from one employer to another, the tax code used by the previous employer is also used by the new employer.  However, that is not always possible. Form P45 is completed by an employer when an employee leaves and has four separate parts. [...]

The Coalition government’s Finance Bill is working its way through Parliament but is unexpectedly short. The two changes required by Europe – the broader access to the Seafarer’s Earnings Deduction and Enterprise Management Initiatives – are missing, as is the amendment to the childcare exemptions that would have removed the “generally available” requirement for low-paid [...]

The Equality Act 2010 comes into force from October 2010.  It replaces, amends and enhances the protections in existing age, disability, gender reassignment, race, religion or belief, sex, sexual orientation, marriage and civil partnership, and pregnancy and maternity legislation. There are also a number of new requirements, in particular employers may be liable if their [...]

On 6 July 2010 the European Commission announced that the NEST pension scheme, part of the Government’s plans to introduce automatic enrolment pension personal accounts in 2012, has been approved under EU State aid rules. The scheme was notified to the Commission because of a loan granted by the Government to fill the funding gap [...]

The Finance Bill has commenced its Parliamentary stages. The provisions announced in the June 2010 Budget that are of payroll relevance in the Bill are explained below. References to the “Finance Act 2010” are to the Act that gave effect to the Labour government’s March 2010 Budget. The Coalition government’s Finance Bill, when enacted, will [...]