Archive for July, 2011

If you fail to file a return online, or make a payment on time, HMRC may impose a financial penalty.  If you decide to appeal against the penalty, you will need a “reasonable excuse”.  Until recently, most appeals have failed.  What has changed? Your holiday runs from January to December.  A new employee starts on [...]

The pressure on HMRC to adjust its interpretation of “reasonable excuse” increases with yet another adverse Tax Tribunal decision. In a number of newsletter items this year, we have highlighted the conflicting views of First-tier Tax Tribunal judges in assessing whether employers who have not met their filing and payment obligations had a “reasonable excuse” [...]

HMRC’s existing Payroll Standard Accreditation Scheme and Online Filing Recognition Scheme are to be replaced by a broader-based Enhanced Recognition Scheme. A new Enhanced Recognition Scheme for payroll software developers is to be introduced from 1 October 2011.  The two existing schemes that it replaces, namely, the formal Payroll Standard Accreditation Scheme, which ensures that [...]

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? Year-end Returns for a ‘ceased’ PAYE Reference I’ve come across a situation for which I hope there’s an obvious answer (that is currently escaping me)! At the moment there are two [...]

Yes, most of this week’s news items feature current pensions issues, in particular the newly published draft regulations on the operation of automatic enrolment, which will now start in July 2012, not October 2012.  Some of the staging dates have changed as a result, so you need to look at the revised schedule to see [...]

The Government is consulting on implementation of changes recommended by the independent Making Automatic Enrolment Work (MAEW) Review, and on some minor amendments to ensure that legislation correctly expresses pension policy. A number of changes to the legislation governing automatic pension scheme enrolment from October 2012 were recommended in 2010 by the Making Automatic Enrolment [...]

DWP research suggests the best words to use when explaining how auto-enrolment…, sorry, automatic enrolment will work… In January 2011, the NEST Corporation published a phrasebook that was intended to put unfamiliar pension terms and expressions into more readily understandable English.  The Department for Work and Pensions has now published its own language guide, which [...]

These notes list the key payroll-related changes in the new Act and provide links to earlier newsletter discussions. The Finance (No. 3) Bill 2010-11 gained Royal Assent on 19 July and became the Finance Act 2011.  The Act contains a number of payroll-related provisions, most of which have been discussed to some extent in our [...]

Changes are made to registered pension scheme legislation to remove the age 75 requirement for the taxation of benefits. Section 65 and Schedule 16 of the newly enacted Finance Act 2011 make new provisions relating to the taxation of benefits available under pension schemes. From 6 April 2011, the requirement to buy an annuity by [...]

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? Student Loans Can you tell me how often the Student Loans get paid over? We obviously pay them over periodically to HMRC, but how long from that point is it to [...]

What are your views on the proposals to merge PAYE tax and NICs?  Good idea but next to impossible? The government would like you views and has posed 14 questions in an effort to understand the issues involved. The issue of what holiday entitlements should apply for employees on long-term sick has generated some new [...]

The Work and Pensions Committee has announced an inquiry into automatic enrolment in workplace pensions and NEST. The role of Commons Select Committees is to consider government policy issues, scrutinise the work and expenditure of government, and examine proposals for primary and secondary legislation. The Work and Pensions Committee has announced an investigation into the [...]

HM Treasury has posed fourteen questions to draw out views on the burdens faced by employers in paying income tax and NICs through the PAYE system. The independent Office of Tax Simplification (OTS) was set up in July 2010 to carry out reviews and provide expert advice to the Chancellor on options to improve and [...]

Umbrella companies and employment businesses have been warned by HMRC that obtaining tax and NICs relief by deduction from gross pay breaks the law. Umbrella companies and businesses supplying temporary workers are under fire again – this time for using a business model that applies tax relief and, in some cases NICs relief, on a [...]

HM Treasury asks for interim reports on two new areas of taxation in time for Budget 2012. The independent Office of Tax Simplification (OTS) was set up in July 2010 to carry out reviews and provide expert advice to the Chancellor on options to improve and simplify the UK’s tax system.  Reports on the first [...]

The new “Child Maintenance Service”, starting in 2012, will require changes to employers’ reporting of DEOs and a change to the DEO calculation. The Child Maintenance and Enforcement Commission (CMEC) is responsible for the child maintenance system in Great Britain.  It has two delivery bodies: Child Maintenance Options, providing the information and support service, and [...]

Indefinite accrual of holiday leave and pay while on sick leave is incompatible with the objective of recuperation, according to the Advocate General. According to case law of the Court of Justice of the European Union (CJEU), the right to annual leave is retained even in cases of long-term illness.  The length of time for [...]

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? Payment after leaving I have made a ‘payment after leaving’ to two former employees. Each employee has been sent a payslip showing them the full details, gross pay, net pay, deductions, [...]

Most of this week’s news items are updates on current issues.  There is more information for both employers and developers about RTI; the legislation is now in place for using tax codes to collect up to £3,000 worth of tax debts; more answers to FAQs are available for the coming “disguised remuneration” PAYE procedures; and [...]

HMRC is concerned that some employers do not know where to view their online coding notices. The following is an extract from the latest weekly informal update (dated 1 July) from HMRC to employer representatives. When you register and activate the PAYE (Pay As You Earn) Online Service, we will send all your PAYE notices [...]