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Tax Facts from Learn Payroll

Articles – Archive

Frequently Asked Questions – Specific to UK Tax and Employment Legislation (UK)

FAQ Conditions of use:

UK Tax and Employment Legislation

Although great care has been taken in compilation and preparation to ensure the accuracy of the answers given to these questions, Payroll-help.com and The Learn Centre Limited cannot in any circumstances accept responsibility for errors or omissions, or for the results of decisions taken. The information given is not legal advice and is not warranted or guaranteed. If legal advice is required, a solicitor or accountant should be consulted, or the Citizen’s Advice Bureau, or another local organisation providing advice on legal, employment or tax matters.

New Frequently Asked Questions

Deductions From Wages

My husband’s employer has taken back all of his SSP and holiday pay in his last wages without telling him. This has left us short for April. Can an employer do that?

My firm wants to provide small gift vouchers in recognition for a job well done. I believe that these are taxable; however, what is the best way for dealing with the tax and NICs liabilities without passing them onto the employee?

Payroll Procedures

Can anyone confirm whether a Canadian working in the UK on a Tier 4 student visa for a German company is liable to pay NICs? UPDATE
Can we accept an electronic P45 from a new employee? Couldn’t they use this at more than 1 employer?
We have 3 employees with CSA Orders against them. We currently do 3 separate payments but can I consolidate them?
We have been using the wrong processing date when making payments in arrears to employees. How do we correct this?
HMRC have recently given an easement for small employers who pay their staff weekly but process the payroll monthly. Is this any use?

Employment Status – Employed or Self-employed?

I am self-employed but my employer has asked me to go PAYE. I have been working there for 9 months and have another job. Can I become a limited company and avoid my employer being penalised this way?
Who are “employees” for payroll purposes?
I am self-employed. Am I entitled to holiday pay or any other benefits from my client?

Expenses and Benefits

If a company van is used on call outs, does this class as private use or insignificant private use? This affects whether there is a van benefit
If an employer wants to claim the VAT back on mileage reimbursements, do the VAT receipts have to at least cover the amount of money that we are reimbursing?
We are considering paying an agency worker’s mileage expenses at a rate over 45p per mile. We are unsure as to how this would be treated – payroll, P11D or is it up to the employee?

With regard to cars and mileage, we have different situations at our workplace – some employees have a company car and a fuel card and some have their own car and a fuel card. The treatment is obviously different and my main query is the treatment of private mileage in these differing situations.

Holiday Pay

The company I work for had a power failure and want employees to take annual leave as they had to be sent home. Can they do this?
How should holiday pay be calculated for shift workers?
Is it true that employees are entitled to paid holiday as soon as they start a new job? If so, how can abuse of this entitlement be prevented?
Does our way of calculating holiday entitlement on termination, based on whole months of service, meet the statutory requirements?

Statutory Payments; Maternity Pay, Paternity Pay and Statutory Sick Pay

Are the new SMP rates effective 01 April or 07 April 2013?An employee finished their SMP on 17 February 2013 and is still on unpaid maternity leave. However, the software has calculated a tax refund for her for March. Is this correct?
Ou r system only allows us to register KIT days from weeks 1 to 39 in the payroll. Is there any problem paying KIT days in the unpaid portion, i.e. weeks 40 – 52?We have an employee on maternity leave and she has accepted another role in the company within her Maternity Leave Period. Although this is a reduced hours role, and a lower salary, the FTE salary is higher than the one used to calculate her Average Weekly earnings for SMP purposes. Is this a pay rise for Alabaster purposes

National Insurance Numbers

What are the NI rules when we are making a payment to a leaver?
Can somebody clarify the rules regarding the NT code? Is this carried forward to the following tax year or is it changed to the Emergency Code?
Can a P45 be issued with a NT code on it so that it can be passed on from one employer to the next?
What is the significance of the letters at the beginning and at the end of my NI number?
I want to get a second job. Do I need a different NI number for each job?

Tax Codes

My husband has two jobs at the same school; however, one of the employments is going to now be paid by the Local Authority. What does this mean for his tax code?
What Does the Letter at the Front of my Tax Code Mean?
What does the letter at the end of my tax code mean?
What does my tax code mean?

Handling HMRC and Payroll Forms

Can anyone supply a link to HMRC’s P45 checker?
Can you please confirm that a P9 from HMRC will never have a non-cumulative tax code on it?
Has anyone else noticed the problem of HMRC issuing cumulative tax code notifications P6 without taxable pay and tax on them?
I have an employee that has just presented a P45 that is 8 months old. Is there a HMRC procedure to follow?

RTI

Our software provider hasn’t included the hashtag on our RTI file and they say that it is the beginning of the pay period that determines whether it should be there. Our pay period began on 01 April which is why it was not included, as this was in 12/13 tax year. Is this correct?
We were in the Pilot and were advised that there were no penalties for RTI if we got everything sorted by 19 may, as usual. We did not submit any FPSs and now find that we can’t do one after 20 April. What do we do now to close the year and submit payroll information for 12/13 if our software does not have the EYU facility?
Should employee pension contributions under a net pay arrangement reduce the ‘Pay after Statutory deductions’ field on the FPS?
We are planning on asking all of the starter questions on one document. Now that the guidance has changed again, can you clarify my understanding?
What is a payment after leaving under RTI?

Pensions

What implication does a salary sacrifice agreement have on the assessment of Qualifying Earnings for Auto-Enrolment?
Can we postpone Auto-Enrolment more than once for the same employee?

We do not always know that an employee has left when we make their final payment to them. Therefore, we make them a leaver in the following month. There are no payments to make and no FPS to submit under RTI. Is there a way of telling HMRC the leave date if I don’t have a FPS to send?

Can someone confirm whether car allowances need to be included in the definition of earnings for auto-enrolment please?

Miscellaneous FAQ’s

We have had telephone calls from the CSA advising us that they can now ask for information over the telephone and we are legally obliged to give it. Is this correct?
When do the CDS DEO changes come into effect?
How common is it for employers under the same PAYE reference and with the same pay frequency to have different paydates
How should an Attachment of Allowances Order be handled by an employer?

Help with My Personal Questions

As you cannot answer my personal question, who can?
How can I find the name and details of my tax office?

Payroll Update 2013