Jun 2021
8
New Feature! Pay HMRC using Modulr
BrightPay’s recent partnership with Modulr was launched with the aim of providing our customers with the most seamless payroll workflow possible. The API integration allows accountants and business owners to pay employees directly from BrightPay.
Our customers responded to the partnership with enthusiasm, registering with Modulr to set up their accounts to try it for themselves. James Toulson, Managing Director of One Less Worry payroll services, who signed up to Modulr, had this to say after trying our new direct payments feature:
Responding to feedback:
Since launching the integration, we’ve worked closely with our customers to understand what worked well and what could be improved. One feature that customers felt would be particularly useful, was a direct payment method to HMRC using the Modulr integration.
To that end, we’re happy to announce that all BrightPay and Modulr customers can now pay HMRC the tax and National Insurance (and any other deductions) owed for each pay period, directly through the payroll software.
What does this mean?
This new feature provides a fast, secure and easy way to pay HMRC through BrightPay. It adds to Modulr’s already existing functionality that helps you to:
- Pay Instantly (under 90 seconds)
- Pay anytime, anywhere (including weekends and bank holidays)
- Save even more time by cutting out numerous steps associated with Direct Debit and Bacs when paying employees and when paying HMRC
- Cut down on errors associated with manual entry
Already a customer? You can view a step-by-step guide on how to pay HMRC using Modulr here.
Pricing Structure
Our aim of creating the best customer experience possible drove our decision to partner with Modulr, a fintech company which is transforming the way companies do business. Modulr are also the payments partner behind the digital banking app, Revolut.
With this partnership, we wanted to provide as many customers as possible with an improved payroll workflow. That’s why BrightPay decided not to receive any referral fees for this service. This allows our customers who register with Modulr to avail of it at a highly competitive wholesale rate.
Get in touch:
Interested in learning more? Get in touch with the BrightPay team to discover the benefits of Modulr’s integration by clicking here. Already a BrightPay customer? Book a demo directly with the Modulr team to learn more.
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Apr 2021
29
Don’t miss the P60 deadline
All employers are legally obliged to issue P60s to employees by 31 May. This is a deadline, so aim to send them before this date. You can use your payroll software, such as BrightPay, to produce them. They can be issued to employees in paper form or electronically. Employees need their P60 to claim back overpaid tax, to apply for tax credits, or as proof of income if applying for a loan or a mortgage.
Does this include all employees?
You need to provide a P60 for each employee on the payroll who was working for you on the last day of the tax year (5 April). Therefore, you’re not required to issue P60s to employees who have left your business during the tax year.
How do I issue P60s in BrightPay?
- The P60 option is located within the Employees menu
- Select an employee who is in active employment as of 5th April from the left-hand listing
- Click P60 on the menu bar and simply select the P60 option you require
Go paperless. We encourage employers to supply P60s digitally to employees. There are many digital options available to you in BrightPay such as email or through the secure online portal, BrightPay Connect. If you do decide to print P60s, there is no need to buy special print paper, as P60 layouts produced by BrightPay have been approved by HMRC for printing on to plain paper.
Read about BrightPay’s sustainability journey and goal of becoming net-zero by 2023.
What happens if I miss the deadline?
If you miss the 31 May deadline to issue P60s to employees, you could face hefty fines from HMRC. The initial penalty for missing the deadline is £300, followed by an additional fine of £60 per day after that. So, if you miss the deadline, make sure to give your employees their P60s as soon as possible or the fine will keep increasing. However, if you miss the P60 deadline due to a genuine error and you take steps to issue the P60 as soon as possible, a fine is less likely.
To assist employers in completing the 2020/21 tax year and transitioning to tax year 2021/22, BrightPay have compiled a list of frequently asked questions, answered by payroll experts.
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Apr 2021
23
Working from Home Tax Relief 2021/22
Working from home became normality for many people since the beginning of the COVID-19 pandemic in March 2020, and still is one year later. A recent survey estimates that 60% of us are still working from the confines of our own homes.
Some good news is that if your employer requires you to work from home, you can benefit from the working-from-home allowance. Employers can pay you £6 a week extra tax-free. And if your employer doesn’t add this allowance to your payslip, you can claim it yourself.
Employees can claim tax relief for additional household costs if you have to work from home on a regular basis, either for all or part of the week. This includes if you have to work from home due to COVID-19. However, you cannot claim tax relief if you choose to work from home. You can apply through the government's dedicated site where you can also check if you are eligible to claim. To claim, you'll need a Government Gateway User ID and password.
Additional household costs include things like extra heating & electricity expenses, work-related calls, internet connection and metered water bills. They don’t include costs that would stay the same whether you were working at home or in an office, for example, rent.
You’ll get tax relief based on the rate at which you pay tax. For example, if you pay the 20% basic rate of tax and claim tax relief on £6 a week you would get £1.20 per week in tax relief (20% of £6). You do not receive this money by cheque as it is done by altering your tax code that indicates to your employer how much tax to take off your payslip. Less tax will be taken off your payslip, meaning you’ll take home more.
You may also be able to claim tax relief on equipment you’ve bought for work, such as a laptop, office chair or mobile phone.
You can now claim for the 2021/22 tax year.
Related Articles:
- The key to keeping in touch with employees when working from home
- 1 Year On – BrightPay & COVID-19
- Furlough extension: How the rules are changing
Mar 2021
31
Furlough extension: How the rules are changing
The furlough scheme has once again been extended, this time until the end of September 2021. The rules in relation to scheme eligibility, the levels of subsidy support, and the reference period used for newly eligible employees are all due to change between now and September.
Levels of Subsidy Support
1st November 2020 to 30th June 2021
Under the existing scheme rules, employers can claim grants covering 80% of wages up to a cap of £2,500 for the hours an employee is not working. Where the employee is not working, the employer does not have to contribute towards wages for unworked hours, but they are responsible for paying employer NICs and pension contributions. Where an employee is on flexible furlough, or also known as partial furlough, employers have to pay full pay for any hours worked.
The Government subsidy will continue at this level until 30th June 2021, but from 1st July, employers will be asked to contribute a percentage of their employees' wages as the scheme winds down.
1st July 2021 to 30th September 2021
For the month of July, the Government will contribute 70% of wages up to a maximum of £2,187.50 per month for unworked hours. The employer will also have to contribute 10% of wages so that the employee receives 80% of their usual wages for any hours not worked, (up to the cap of £2,500).
For August and September, the Government subsidy will drop to 60% up to a cap of £1,875 per month, with the employer having to top up the additional 20% so that the employee receives 80% of their wages (again, up to the cap of £2,500).
Employers must continue to pay the employer NICs and pension contributions on the Government subsidy for the hours not worked. Employers can also continue to choose to top up their employees’ wages above the 80% total and £2,500 cap for the hours not worked at their own expense.
Scheme Eligibility
On or before 30th April 2021
For periods ending on or before 30th April 2021, you can claim for employees who were employed on 30th October 2020, as long as you have made an RTI submission to HMRC between 20th March 2020 and 30th October 2020, notifying HMRC of a payment made to that employee.
Employees made redundant, or who stopped working for you, after 23rd September 2020 can be rehired and placed on furlough under the scheme up until 30th April 2021. This is allowed as long as the employee was employed as of 23rd September 2020 and included in an RTI submission between 20th March 2020 and 30th October 2020.
On or after 1st May 2021
For periods starting on or after 1st May 2021, you can claim for employees who were employed on 2nd March 2021, as long as they were notified to HMRC on an RTI submission between 20th March 2020 and 2nd March 2021. You do not need to have previously claimed for an employee before the 2nd March 2021 to claim for periods starting on or after 1st May 2021.
The Government has not yet produced guidance for calculating hours for workers who were first on the payroll after 30th October 2020 but will do so shortly. This will only be relevant for workers furloughed for the first time from 1st May 2021 onwards.
Free Furlough Webinar
Join the BrightPay team for a free webinar where they explore the upcoming changes to the furlough scheme, how BrightPay payroll software caters for CJRS and furlough, and answer any questions that you may have.
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Mar 2021
3
Budget 2021 – An Employer Focus
Chancellor of the Exchequer Rishi Sunak presented Budget 2021 to Parliament today 3rd March 2021.
The main points to be noted by employers are:
- The personal tax allowance will increase from £12,500 to £12,570 for the new tax year 2021-22 and the plan is to keep it at this level until 2026.
- The higher rate income tax threshold will increase by £270 to £50,270 from 6th April 2021 and will be frozen until April 2026.
- The NIC primary threshold will increase by £68, from £9,500 to £9,568 for 2021-22.
- The Coronavirus Job Retention Scheme is to be extended until the end of September 2021 with the government to continue paying 80% of employees' wages for hours they cannot work. Employers will be asked to contribute 10% for July and 20% for August and September.
- The grant for new apprenticeships made available by employers in England to be extended to September 2021 and the amount increased to £3,000.
- Traineeships to get a £126 million boost to fund 40,000 more places.
- The Employment Allowance remains at £4,000 and will apply to eligible employers whose Secondary Class 1 National Insurance Contributions liability is under £100,000 a year.
- From 1st April 2021, the National Living Wage of £8.91 per hour will now be paid to employees aged 23 years and over instead of the previous age threshold of 25 years and older.
- The Vat rate for the hospitality sector will remain at 5% until 30th September 2021. This will increase to 12.5% until 31st March 2022, with the 20% rate resuming from April 2022.
- £5 billion in new Restart Grants for businesses announced – £6,000 for non-essential outlets that are due to re-open in April and for hospitality, accommodation, leisure, gym and personal care businesses, a one-off cash grant of up to £18,000.
Related Articles:
- Getting ready for the new tax year, with BrightPay
- No fines for accidental IR35 errors for the first year
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Mar 2021
3
New Advisory Fuel Rates from 1st March 2021
The latest Advisory Fuel Rates that will come into effect from 1st March 2021 for company cars has been advised by HMRC. Employers may use the old rates for up to one month from the date the new rates apply. Employers are under no obligation to make supplementary payments to reflect the new rates but can do so if they wish. Hybrid cars are treated as either petrol or diesel cars for this purpose for the fuel rates. For fully electric cars, the Advisory Electricity Rate is 4 pence per mile. However, electricity is not a fuel for car fuel benefit purposes. Click here to see all details per HMRC.
| Engine size | Petrol - amount per mile | LPG - amount per mile |
| 1400cc or less | 10 pence | 7 pence |
| 1401cc to 2000cc | 12 pence | 8 pence |
| Over 2000cc | 18 pence | 12 pence |
| Engine size | Diesel - amount per mile |
| 1600cc or less | 9 pence |
| 1601cc to 2000cc | 11 pence |
| Over 2000cc | 12 pence |
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Jul 2020
13
How To Process COVID-19 Related SSP in BrightPay 20/21
HMRC have advised that if an employee needs to take time off sick or to self-isolate due to COVID-19, the first 3 waiting days that normally apply for SSP will be disregarded and the employee will be entitled to receive SSP from the first day.
We have programmed BrightPay 20/21 so that there is a new option for ‘COVID-19 Related Sick Leave’ and, by choosing this option, the software will automatically apply any SSP due to the employee from day one. Whereas, if you were to choose the normal SSP, the software will take into account the usual 3 waiting days.
With the Coronavirus Statutory Sick Pay Rebate Scheme, the employer can claim for up to 2 weeks sick leave for an employee that cannot work due to COVID-19, and also those who are self-isolating or shielding, subject to eligibility criteria.
An SSP Claim Report is available in BrightPay to assist users in ascertaining the amounts needed for input into HMRC's Coronavirus SSP Rebate Scheme online service.
A Step By Step Guide To Processing In BrightPay
Processing COVID-19 related Statutory Sick Pay is easy in BrightPay. Here’s a detailed step-by-step guide to help you do it.
Processing COVID-19 Related Sick Leave in BrightPay
- First, you need to select the employee’s name on the left. Under ‘Statutory Pay’, click ‘Calendar’, and on the calendar, select the date range that the employee is out on sick leave.
- Click ‘Sick Leave’ from the options on the right of the screen and choose 'COVID-19 Related Sick Leave'. The number of ‘Qualifying Days’ & ‘SSP Days’ will be displayed on the screen, bypassing the usual 3 waiting days.
- When you close out of the calendar, BrightPay will automatically apply any SSP due to the employee.
It is important to note that if existing payment records have not been recorded in BrightPay or if there is insufficient historical payroll data to determine the employee's average weekly earnings, the automatic calculation may be inaccurate or not possible. In this instance, you can manually override the employee’s average weekly earnings.
BrightPay’s Coronavirus SSP Rebate Scheme Claim Report
As mentioned, BrightPay also has a claim report to assist users in determining the amounts that you can reclaim through the Coronavirus SSP Rebate Scheme. This report can be found within the ‘Employees’ tab in BrightPay.
- First enter the start and end date of the claim period you are claiming for.
- On the next screen, select the employees you wish to include in your claim.
- If your chosen claim period covers some of the 19/20 tax year, enter COVID-19 related SSP amounts that you wish to claim for the previous tax year.
- On the final screen, a summary of your claim will be displayed. Enter any of the additional information that HMRC require when making a claim. If you wish, you can view the full report, and this can be printed, exported or emailed for your records.
Each claim report generated in the software is stand-alone and no data is saved each time a claim report is run. Therefore, it is your responsibility to ensure that you have exported the report, so that you don’t lose the information.
SSP & Furloughed Employees
Furloughed employees retain their statutory rights, including their right to Statutory Sick Pay, and so furloughed employees who become ill must be paid at least the rate of SSP, subject to them meeting the eligibility criteria. You can claim back from both the Coronavirus Job Retention Scheme and the SSP rebate scheme for the same employee but not for the same period of time.
If an employee becomes sick while furloughed, it is up to the employers to decide whether to move these employees onto Statutory Sick Pay or to keep them on furlough, at their furloughed rate. If the employee is moved onto SSP, employers can no longer claim for the furloughed salary. Whereas, if the employee is kept on the furloughed rate, they remain eligible for the employer to claim for these costs through the furlough scheme.
Free COVID-19 Webinars For Employers
Want to keep up-to-date with the latest updates regarding COVID-19 and businesses? We’re holding regular webinars to share with you all news relating to HMRC updates, what employers need to know and how you can make sure you’re complying with best practices at all times.
Click here to watch our previous webinars on-demand, where we cover everything from important COVID-19 payroll updates to return to work government policies and more.
To receive email notifications letting you know when we’re holding our next webinar, sign-up to our mailing list and ensure you don’t miss out on the latest updates for your business.
Apr 2020
14
Details of what an Employer needs to Claim for Furlough Employees
HMRC has announced that the online portal or service for employers to make claims relating to the Coronavirus Job Retention Scheme is planned to be launched on 20th April 2020. In order to process the claim employers must have:
- A PAYE scheme that was created and commenced on 28th February 2020
- Enroll for HMRC’s PAYE Online service
- Have a UK bank account
Employers will need the following for the claim:
- Employer PAYE reference
- Self-Assessment Unique Taxpayer Reference or Corporation Tax Unique Taxpayer Reference or Company Registration Number
- Contact name and number
- Bank account details – sort code and account number
- The number of furloughed employees
- Names for all furloughed employees
- National Insurance numbers for all furloughed employees
- Payroll or works numbers for all furloughed employees
- Dates for the furloughed period – start and end date
- Amount for the claim (per the minimum length of furloughing of 3 consecutive weeks)
An employee that was furloughed has to be on furlough leave for a minimum of 3 weeks in a row in order to be eligible under the reclaim scheme. Employees may have been placed on furlough leave multiple times but each period has to be a minimum of 3 weeks in a row.
The amount the employer is coming to claim from HMRC must be calculated by the employer. They may use records from their payroll software to help ascertain the amount of the claim. Where employees were already placed on furlough leave claims can be backdated until 1st March. Authorised agents that have the capacity to act on behalf of their clients for PAYE matters will be able to claim on behalf of their clients. But agents with permission to file only and payroll bureaus will not have the ability to access this service on behalf of their clients. But file only agents may have to assist their clients in order to be able to make the claim and are being encouraged by HMRC to help where they can.
HMRC will check each claim made for each employer and if the employer fulfils the criteria for the scheme then payment will be made by HMRC into the UK bank account by BACs transfer. HMRC reserves the right to audit any employers’ claim under this scheme.
Dec 2019
6
Advisory Fuel Rates updated from 1st December 2019
HMRC has issued details regarding the latest Advisory Fuel Rates for company cars.
From the 1st December 2019 employers may use the old rates or new rates for one month. Employers are under no obligation to make supplementary payments to reflect the new rates but can do so if they wish. Hybrid cars are treated as either petrol or diesel cars for this purpose for the fuel rates.
The rates are as below:
| Engine Size | Petrol- amount per mile | LPG - amount per mile |
| 1400cc or less | 12 pence | 8 pence |
| 1401cc to 2000cc | 14 pence | 9 pence |
| Over 2000cc | 21 pence | 14 pence |
| Engine Size | Diesel - amount per mile |
| 1600cc | 9 pence |
| 1601cc | 11 pence |
| 2000cc | 14 pence |
For fully electric cars the Advisory Electricity Rate is 4 pence per mile. But electricity is not a fuel for car fuel benefit purposes. Please click here to see all details as per HMRC.
Aug 2019
20
Three day easement for FPS to continue
HMRC have confirmed they are continuing the three day easement for filing of Full Payment Submissions that was introduced in 2015. Employers are required to file their PAYE information to HMRC on or before each payment date, which is the statutory filing date, unless the circumstances set out in the 'sending an FPS after payday guidance' are met. The three day easement is not an extension to the statutory filing date. No late filing penalties will be charged for late filing up to three days after the statutory filing date.
Employers can get a penalty in the following circumstances:
- The Full Payment Submission was late
- Failure to send:
- Expected number of FPS
- An Employer Payment Summary when there were no payments made to any employees in a tax month
HMRC had advised they will not charge a penalty if:
- The FPS is late but all reported payments on the FPS are within the three day period of the employees’ pay date. However, employers who consistently are filing their returns for up to three days after the payment date may be contacted by HMRC or considered for a penalty.
- The employer is a new employer and the first FPS is sent within thirty days of paying an employee
- It is the first time the employer has failed to send an RTI on time in the tax year (does not apply to employers with an annual scheme)
