Employers facing increase in sick pay costs!!

From 6 April 2014, employers will no longer be able to recover payments made for Statutory Sick Pay (SSP). HMRC has made the decision to abolish the Percentage Threshold Scheme (PTS), which is the scheme in place to provide SSP compensation for employers.

Currently an employer is entitled to recover some of the SSP paid to their employees if the total SSP paid in a tax month is greater than a set percentage of their gross Class 1 NICs (employers’ and employees’) liability for that month

Although PTS is being abolished from April 2014, employers will still be able to make claims for reimbursement of SSP under PTS (paid for sickness periods up to 5 April 14) until the end of the 2015/16 tax year.

In addition, the associated SSP record-keeping requirements will also be abolished at the end of 2013/2014. However, employers will still be required to maintain records for PAYE purposes and to demonstrate they are meeting their SSP obligations.

The decision to abolish PTS was made as a result of an independent review which found that the current scheme does not support the proper management of sickness absence in the workplace.

The Government has therefore decided to reinvest the money in a new Health and Work Service (HWS), due to be introduced by the end of 2014. The aim of this service will be to:

• help employees who have been on sickness absence for four weeks or more to return to work,
• support employers to better manage sickness absence among their workforce,
• give GPs access to work-related health support for the patients.

Employers, who want to avoid being faced with increasing costs, need to look carefully at how they manage sickness absence in their workforce. The first point of action will be to implement, or review, the company sickness policy.

Posted byLaura MurphyinCompany HandbookContract of employmentNICPayroll Software

HMRC and their new call handling

HMRC have recently introduced a new way of handling calls on some of their helplines and they are looking for Employers to offer their feedback through a short survey.

The new system is called Intelligent Telephony Automation or ITA. HMRC say that this new technology will help improve the handling of calls, instead of being offered different options or pressing different buttons the system will recognise and react to what the customer says. The customer will be put onto the correct adviser for their question even if they have called an incorrect telephone number.

HMRC are also automating elements of the security process, based on the information that the customer provides the system, the adviser will know why they are calling and whether or not the customer has passed security. HMRC are hoping that this will speed up the time that advisers spend with customers and it will allow them to focus on the issue and the call could be completed a lot quicker.

This new system will prompt customers to say a few words and the reason for their call. It is designed to recognise key words or phrases such as Maternity/RTI/P45 and can forward the call onto the correct Adviser or ask further questions if required. HMRC say the system has been widely tested with all accents from all over the UK. The HMRC would like customers that have called the helpline and have used the ITA system to complete a short survey by Friday 29th November to give their feedback and to see if there are any ways that the system could be improved.

Posted byDenise CowleyinHMRC

Knowing your responsibilities as a UK employer re student loan deductions

With the increased amount of students entering the workplace owing close to £30000 (for tuition fees averaging £9000 a year along with living costs) it could be many years until a student debt is repaid. Once an employee has commenced employment student loan deductions will be taken at source from their pay and sent by their employer to HMRC so the sooner this begins the sooner the student loan is paid off.

When should an employer begin taking student loan deductions ?

1. When a receipt is received from HMRC of a start notice SL1 informing the employer from when they should start taking the student loan deduction.
2. The employee has a P45 from a previous employer and there is a yes ticked beside liable for student loan or any other mark at item 5 on the P45.
3. If the employee does not have a previous P45 they must complete a starter checklist (similar to a P46 form) one of the questions asks if the student has a student loan that has not been fully repaid and is not being repaid directly to the students loan company. If the employee answers yes student loan deductions are now due.

Where an employee does not provide a P45 to their new employer and a starter checklist is filled out the employee may not admit to having to pay a student loan so the preferred option to set up a new employee would be to receive the P45 from the previous employer or a start notice SL1 which they would receive from HMRC.

Posted byDenise CowleyinPayroll Software

110,000 UK parents silent on Child Benefit Claims

10% of 1.1m people affected by High Income Child Benefit Charge have still not contacted HMRC and could face losing the benefit and receive penalties.

Parents on individual salaries of £50,000 or higher were required to either opt out of receiving Child Benefit or register for Self Assessment by the October 5^th deadline, in order to avoid financial penalties. Families in which parents each earn less than £50,000 are likely to continue to receive child benefit without having to pay the money back.

Penalties will be raised on a case by case basis and depending on the circumstance, the penalty could be reduced to zero, however tax would still be applicable.

It must also be noted that eligibility for child benefit depends not just on earnings but on "adjusted net income". This includes all taxable net income, including rental income and investments. bonuses and benefits in kind.

Posted byAnn TigheinHMRC

2014 National Insurance: £2000 Employment Allowance

From 2014 every business, Charity and CASCs (Charities and Community Amateur Sport Clubs) will be entitled to an annual “employment allowance” of £2000 to reduce their liability for Class I secondary NICs.

It is expected that up to 1.25 million employers will benefit, with over 90 per cent of the benefit going to small businesses with fewer than 250 employees and it is envisaged that on average, employers with fewer than ten employees will see their employer NICs bill reduced by 80%.

To simply matters HMRC will introduce a new tick box on EPS referring to the employment allowance in the form of a “yes/no” indicator. 

To claim the allowance, the employer will have to signify his intention to claim by completing the yes/no indicator just once.  The employer will then offset the allowance against each monthly Class 1 secondary NICs payment that is due to be made to HMRC until the allowance is fully claimed or the tax year ends.

This  Employment Allowance will apply per employer regardless of how many PAYE schemes that employer chooses to operate.

Posted byAnn TigheinPayroll Software

BrightPay shortlisted for AccountingWeb Software Satisfaction Awards

We are delighted to let you all know that we have been shortlisted by AccountingWeb for their Software Satisfaction Awards – Payroll Category. We would like to say a big thank you to all of our BrightPay customers that gave such positive feedback which has resulted in us being shortlisted. Customer satisfaction is paramount to us here in BrightPay. We will strive to ensure the highest level of customer satisfaction both in our product and service at all times.

The winners will be announced on the 7^th November so wish us luck!

http://www.accountingweb.co.uk/article/software-satisfaction-awards-shortlists-revealed/548792

Posted byCaroline MaloneinAwardsPayroll Software

New PAYE messages to employers from HMRC from 21st October

From this week HMRC will start to send four types of new messages to employers to help them keep their PAYE up-to-date.

These messages will take two formats:

1. The first three are generic electronic messages to warn the employer that their PAYE submissions and payments appear to have fallen into arrears.

2. The fourth one will be a letter, telling an employer that HMRC are cancelling a PAYE scheme that has been inactive for 120 days.

The electronic messages are not penalty notices and therefore an employer should not appeal against them. These messages do not replace the existing compliance communications, which will continue as now.

The aim of these messages is to help employers comply with their PAYE obligations and in particular get their businesses to submit and pay their PAYE to HMRC on time. This will help them get ready for 6 April 2014 when in-year penalties for late reporting and late payment will replace the current end-of-year PAYE penalties. HMRC wants to receive payments and returns on time; it does not want to charge penalties.

The messages warn that the employer may incur penalties in future, even if they have done nothing wrong for 2013-14 (for example if they are a smaller employer taking advantage of the current relaxation for ‘on or before’ reporting). If this is the case the employer does not need to contact HMRC but they should be preparing for 2014-15.

HMRC will update the wording of these messages in April 2014.

Posted byAnn TigheinPayroll SoftwareRTI

8 Reasons why HMRC cancel Employer PAYE Schemes

1.             You have made no submissions using PAYE in Real Time
2.             You have not made any payments to HMRC
3.             You are not an annual payer
4.             There is no evidence that you want to claim CIS Deductions Suffered
5.             You have not received an advance from HMRC
6.             You have not had any periods of Construction Industry Liability
7.             There is no evidence that you have had any employees
8.             There is no evidence that Class 1A NIC is due

Where any of these conditions apply your employer scheme will be cancelled and a letter issued to your business address to advise you of the action taken.  Once the scheme has been cancelled you will not be able to submit any PAYE submissions in Real Time.  If your scheme should not have been cancelled the letter covers who you should contact in HMRC to request that your scheme is reopened.

Posted byAnn TigheinHMRCPayroll Software

GOOD NEWS PROPOSED FOR COMMUTERS

The Mayor of London, Boris Johnson, has proposed that season tickets for commuters be considered as a salary sacrifice to give tax relief to those who have to travel to work. He has suggested that they be treated the same as the current Child Care Voucher or Cycle to Work Scheme. The employer would buy the season ticket and deduct the cost from the employee’s pay before tax is deducted. Therefore the employee would have the benefit of the ticket but pay tax on a lesser amount.

At the moment this is only a proposal and has been forwarded to the Chancellor for consultation.

Posted byGerri McGinleyinPayroll Software

UNIVERSAL CREDIT – GOOD NEWS FOR UK EMPLOYERS

Universal Credit is a new single monthly payment for people on low incomes or out of work. It aims to ensure that people are better off working that claiming benefits.

This means that they would not lose all their benefits if they take up employment and are receiving a low income and their Universal Credit would only reduce gradually as their income increases.

WHAT WILL THIS MEAN FOR EMPLOYERS

Employers will benefit from this in a number of ways.

It will be easier to fill jobs either short time or with irregular hours.

It will mean that more flexible working hours can be put in place for existing employees without needing to recruit new employees and the expense that would incur.

Employers will be able to access people registered on Universal Jobmatch  and thereby fill vacancies more quickly.

Universal Credit Payments are linked to the amount an employed Universal Credit claimant has earned. Since RTI (Real Time Information) was introduced HMRC already has the required information on each employee.

Universal Credit is being rolled out gradually and a national roll out will occur from October 2013.

Between April 2013 and 2017 Universal Credit will replace Income based Jobseekers Allowance, Income-related Employment and Support Allowance, Income Support, Working Tax Credit, Child Tax Credit and Housing Benefit. By 2017 it will be paid to everyone who has the right to receive it.

Posted byGerri McGinleyinPayroll