Archive for March, 2011

Each week we receive a number of payroll questions on our forum, and here are this week’s batch. Can you help with any answers? SMP new rate Whilst completing the maternities I can see that the SMP increased from Sunday 3rd April from £124.88 to £128.73 per week. I am I correct in saying that [...]

The Chancellor presented his annual Budget to Parliament on 23 March so this week’s newsletter explains those announcements that are relevant to payroll. The Budget did not contain many surprises, although the plan to consult on merging PAYE tax and NICs would have been unexpected had not the Office of Tax Simplification published their recommendations [...]

From April 2011, the under-65 personal allowance increases from £6,475 to £7,475 as the first stage of the Government’s plans to increase the allowance to £10,000 before the end of the current Parliament. From April 2012, the personal allowance will increase by a further £630 to £8,105.  However, as in April 2011, the basic rate [...]

The June 2010 Budget announced that the default indexation for direct taxes, including income tax and NICs, will be the (lower) Consumer Prices Index (CPI) instead of the Retail Prices Index (RPI) from April 2012.  However, to ensure employers and older people do not lose out, the Government has confirmed that there will be some [...]

Last week’s newsletter included a review of two reports issued by the Office of Tax Simplification in time for consideration by the Chancellor for his Budget announcements on 23 March.  A number of the recommendations found their way into the Budget, as follows. Of the various tax reliefs considered by the OTS, 43 are to [...]

The Government’s view is that the state pension system is too complex, making it difficult for working-age individuals to determine what they might receive from the state, in particular from the State Second Pension.  The Budget announcement is that the DWP is to publish a Green Paper to consult on options for reform, which will [...]

For employees required to use their own car or van for work, the approved mileage rate for cars and vans will increase, from April 2011, to 45p per mile (up from 40p) for the first 10,000 miles in a tax year, and 25p per mile thereafter.  For NICs purposes, the new limit is 45p per [...]

Appropriate percentage: For 2011/12, the appropriate percentages for company petrol cars range from 15% to 35% for emission ratings of 125 to 225 g/km.  For 2012/13, the range, as already announced, will widen to between 11% and 35% for emission ratings of 100 to 220 g/km, with a fixed 10% for emission ratings below 100 [...]

The “generally-available” condition One of the statutory conditions for tax relief for employer-supported childcare is that it be made “generally available” to all of an employer’s employees.  Employer-supported childcare refers to the provision of childcare under a contract between the employer and the childcare provider, and to the provision of childcare vouchers. Budget 2010 announced [...]

A number of measures are to be included in the 2011 and later Finance Bills to prevent the use of certain tax avoidance schemes. However, the Government has announced that measures will also be included in the 2012 Finance Bill to deter the continued use of avoidance schemes that are believed not to deliver the [...]

The current £15,000 annual threshold for student loan deductions through the payroll was due for review by the last Government in 2011.  The Coalition government decided instead to increase the threshold annually between 2012 and 2016 in line with inflation.  The statutory changes for this have been made by means of amendments to the Education [...]

The following is an extract from the latest weekly informal update (dated 18 March) from HMRC to employer representatives. 1. Issue of P9 Coding Notices to employers As we told you in last week’s update, we issued the bulk of P9s electronically by 11 March.  Indications from both employers and individual customers suggest that accuracy [...]

On 22 March the Department for Business, Innovation and Skills (BIS) published a document entitled Sunsetting Regulations: Guidance.  It provides guidance for Government departments to support the Government’s commitment to “sunset” new statutory regulation by setting a date on which it will expire automatically unless positive action is taken to renew it. The term “regulation” [...]

Each week we receive a number of payroll questions on our forum, and here are this week’s batch. Can you help with any answers? Childcare for future employee An employee is planning to start with us in July at the end of a period of maternity leave with her previous employer. She has contacted us [...]

The Chancellor presented his 2011 Budget to Parliament on 23 March.  A detailed review of the payroll-related measures will appear in our weekly newsletter on Monday, 28 March. The following is a short summary of the key measures set out in the 2011 Budget. Personal tax allowances From April 2012, the personal allowance will increase [...]

This week we are back to normal with (too) many news items.  Of particular interest and importance are the two reports from the Office of Tax Simplification, which resurrect a number of proposals from earlier years, some of which may well find their way into the coming Budget.  The PAYE Regulations have been updated with [...]

Two weeks ago we described the errors that we had found with three of this year-end’s P11D Working Sheets.  The following is an extract from the latest weekly informal update (dated 11 March) from HMRC to employer representatives. Basic PAYE Tools We are aware of recent reports on some payroll industry websites and forums that [...]

Sections 270A and 318A of the Income Tax (Earnings and Pensions) Act 2003 (ITEPA) provide limited tax exemptions for the provision of childcare vouchers and employer-supported childcare.  One of the conditions that must be met in order for these exemptions to apply is that the childcare must be “qualifying child care”.  The definitions of “qualifying [...]

The Office of Tax Simplification (OTS) is tasked by the Treasury with simplifying tax reliefs and small business taxation (including the IR35 rules) and making recommendations to the Chancellor in advance of Budget 2011. In November 2010 the OTS published the first ever comprehensive list of the UK’s tax reliefs and allowances on its website, [...]

New Regulations have been made and come into effect from 6 April 2011 that disapply certain aspects of pension legislation from the National Employment Savings Trust (NEST) Corporation.  NEST is the pension scheme that has been established to assist up to a million UK employers comply with their automatic enrolment obligations from 2012.  The NEST [...]