Good Friday 2012Sunday, October 30th, 2011
It happened in 1928, 2007 and in 2012 it is happening again – Good Friday falls on 06 April, the first day of the tax year. Although most of us have not even begun to think about 2012, let alone Easter, it is worth pointing out as new calendars and diaries start to arrive on our desks.
In the normal course of events, as Good Friday is a non-banking day, any payment due would be brought forward to the 5th. In turn, the normal procedure would be for this to be treated as a Week 53, as per HMRC CWG2 guidance (54 for bi-weekly, 56 for lunar). Indeed, when this last
happened in 2007, HMRC’s original instruction to Software Developers in September 2006 was that the payment due 06 April but paid on the 5th would be classed as a Week 53. The following week would be Week 2 for tax purposes but would actually be the first payment for the employee in the new tax year. Whilst this proved a puzzle for developers and payroll professionals alike, the clear instruction was that PAYE and NICs processes should not vary from previous guidance where payday is bought forward as a result of Good Friday being on 06 April.
However, in December 2006, HMRC issued supplementary guidance, recognising that there could be ‘inconsistent’ PAYE deductions. The revised guidance for the operation of PAYE and Class 1 NICs when the regular date for payment is a non-banking day states:
Where a regular pay day falls on a non-banking day (Saturday, Sunday or Bank Holiday) and because of this the payment is made on the last working day before the regular payday, the payment may be treated for PAYE and Class 1 NIC purposes as having been made on the regular payment day
Anyone that might be affected is advised to consider the situation and discuss with their software provider / payroll provider. We managed it the last time
When will this happen again – 2091. I wonder what kind of a world we will be living in at that time and whether people will remember the Internet!