The Payroll Pro

01/03/2024

National minimum wage increases! Good news for over 21’s

23/11/2023

19/07/2023

All the time 😂

25/06/2023

Love this!

Agreed

11/01/2023

😳😂

10/01/2023

Employee Benefits - Vehicle Benefit Charge from April 2023

The vehicle benefit charges for 2023-24 have been announced. Where employees are provided with fuel for their own private use by their employers, the car fuel benefit charge is also applicable. The fuel benefit charge is determined by reference to the CO2 rating of the car, applied to a fixed amount. The car fuel benefit charge will increase in 2023-24 to £27,800 (from £25,300). The fuel benefit is not applicable when the employee pays for all their private fuel use.

The standard benefit charge for private use of a company van will increase to £3,960 (from £3,600). A company van is defined as ‘a van made available to an employee by reason of their employment’. There is an additional van fuel benefit charge for a van with significant private use. The limit will increase in 2023-24 to £757 (from £688). If private use of the van is insignificant, then no benefit will apply.

Since 6 April 2021, the van benefit charge has been reduced to zero for vans that produce zero carbon emissions. This measure supports the governments climate change agenda by encouraging the uptake up of vans that emit zero carbon emissions.

09/01/2023

Trivial benefits - Employment and Payroll

Don't forget to take advantage of tax-free trivial benefits. If you are an employer and looking to give your employees a small token of appreciation then your best option is probably to give them a gift. In order to ensure that this is not a taxable gift, it is important to ensure that the trivial benefits in kind (BIK) rules appDon’t forget to take advantage of tax-free trivial benefits. If you are an employer and looking to give your employees a small token of appreciation then your best option is probably to give them a gift. In order to ensure that this is not a taxable gift, it is important to ensure that the trivial benefits in kind (BIK) rules app .

There is no tax to pay on trivial benefits in kind (BIK) provided to employees where all of the following apply:

• the benefit is not cash or a cash-voucher; and
• costs £50 or less; and
• is not provided as part of a salary sacrifice or other contractual arrangement; and
• is not provided in recognition of services
performed by the employee as part of their employment, or in anticipation of such services.

So, for example a food gift that costs £45 would qualify as would a £15 bottle of wine. It is also possible to provide employees with a gift voucher (not a cash-voucher) where the value is £50 or less. It is important to remember that the gifts must not be provided in recognition of the employees’ services but merely as a gesture of goodwill.

There is an annual cap for directors of a ‘close’ company of £300 per year. If the gifts have a value of over £50 or cannot be counted as a trivial benefit, then the gift must be reported on form P11D and Class 1A NICs will be payable on the value of the gift.

22/12/2022

Messages like this make it all worth it and means so much ❤️

Merry Christmas 🎄

Enjoy, relax and recharge ❤️

01/12/2022

IR35 Reform

One of the measures the Chancellor of the Exchequer, Kwasi Kwarteng referred to in the delivery of the Growth Plan 2022 (commonly referred to as the mini-Budget) concerned moves to simplify IR35 rules. This measure was one of the pre-election promises of the new Prime Minister, Liz Truss. In the end it seems that the Chancellor went further than expected and announced moves to simplify the IR35 rules that included the full repeal of the 2017 and 2021 reforms.

The rules for individuals providing services to the public sector via an intermediary such as a personal service company (PSC) changed from April 2017. The rules shifted the responsibility for deciding whether the intermediaries’ legislation applies, known as IR35, from the intermediary itself to the public sector receiving the service. These rules were further extended in April 2021 for individuals providing services to certain medium and large-sized clients private sector organisations via an intermediary such as a personal service company (PSC). Small companies remained exempt.

It should be noted, that whilst the full details on this change remain to be published, the repeal of the 2017 and 2021 reforms is set to take place with effect from the start of the 2023-24 tax year on 6 April 2023.

From this date, contractors providing services via an intermediary will once again be responsible for compliance with the IR35 rules to determine their employment status and to pay the necessary tax and National Insurance contributions. This will remove the burden that currently falls on businesses and public authorities to determine the employment status of their contractors.

The government will need to ensure that these reforms do not result in increased tax avoidance and there may be new measures put in place in that regard. We will publish further information when more details are made available.

30/11/2022

Minimum Wage

Employers must ensure they are paying staff at least the National Minimum Wage (NMW) or National Living Wage (NLW). The NMW and the NLW are the minimum legal amounts that employers must pay their workers.

HMRC’s guidance states that there are different ways of checking that workers get the minimum wage depending on whether they are:

paid by the hour (known as ‘time work’);

paid an annual salary, under a contract for a basic number of hours each year (known as ‘salaried hours’);

paid by the piece - the number of things they make, or tasks they complete (known as ‘output work’); and

paid in other ways (known as ‘unmeasured work’) once you know how many basic hours you can calculate if they are being paid at least the minimum wage to which they are entitled.

There are penalties for employers that are found to have underpaid their workers and, in some cases, there may be criminal prosecutions. The NLW is the minimum hourly rate that must be paid to those aged 23 or over. The rates for the period from 1 April 2022 – 31 March 2023 are as follows. The rate for the NLW is £9.50. The hourly rate of the NMW (for 21-22 year olds) is £9.18. The hourly rate for 18-20 year olds is £6.83 and the rate for workers above the school leaving age but under 18 is £4.81. The NMW rate for apprentices is £4.81.

If an employee has been underpaid, the employer must pay any arrears without delay. There are penalties for non-payment of up to 200% of the amount owed. The penalty is reduced by 50% if all of the unpaid wages and 50% of the penalty are paid in full within 14 days.

The maximum fine for non-payment can be up to £20,000 per employee and employers who fail to pay face up to a 15-year ban from being a company director as well as being publicly named and shamed.

29/11/2022

Tax Relief for Job Expenses

Employees who are working from home may be able to claim tax relief for bills they pay that are related to their work.

Employers may reimburse employees for the additional household expenses incurred through regularly working at home. The relief covers expenses such as business telephone calls or heating and lighting costs for the room you are working in. Expenses that are for private and business use (such as broadband) cannot be claimed. Employees may also be able to claim tax relief on equipment they have bought, such as a laptop, chair or mobile phone.

Employers can pay up to £6 per week (or £26 a month for employees paid monthly) to cover an employee’s additional costs if they have to work from home. Employees do not need to keep any specific records if they receive this fixed amount.

If the expenses or allowances are not paid by the employer, then the employee can claim tax relief directly from HMRC. Employees will receive tax relief based on their highest tax rate. For example, if they pay the 20% basic rate of tax and claim tax relief on £6 a week, they will receive £1.20 per week in tax relief (20% of £6). Employees can claim more than the quoted amount but will need to provide evidence to HMRC. HMRC will accept backdated claims for up to 4 years.

Employees may also be able to claim tax relief for using their own vehicle, be it a car, van, motorcycle or bike. As a general rule, there is no tax relief for ordinary commuting to and from the regular place of work. The rules are different for temporary workplaces where the expense is usually allowable if the employee uses their own vehicle to do other business-related mileage.

Note, that if an employee agreed with their employer to work at home voluntarily, or they choose to work at home, they cannot claim tax relief on the bills they have to pay. If an employee previously claimed tax relief when they worked from home because of coronavirus (COVID-19), they might no longer be eligible for relief.