Helping you as an employer.

Transcription

1 Helping you as an employer. At Price Bailey - It s all about you The right advice for your business life pricebailey.co.uk

2 Welcome Welcome to the Price Bailey newsletter, where we will be highlighting everything you need to know in for payroll. In this issue we look at the introduction of the Apprenticeship Levy, employment allowance, auto enrolment, rates and allowances for the tax year -18, National Insurance, statutory rates (per week), changes to NMW and NLW from April and finally the changes to salary sacrifice. Contents: Apprenticeship levy & payroll end of year reporting (P.3) Employment allowance, auto enrolment & rates and allowances for the tax year Income tax (P.4) National Insurance & statutory rates (P.5) Changes to NMW and NLW & salary sacrifice changes (P.6) We hope that you find our newsletter informative and would welcome any feedback you may have. 2

3 Apprenticeship Levy As of 6 April the government are introducing the Apprenticeship Levy. This levy will require all employers operating in the UK, with a gross annual pay bill (employees earnings) over 3 million, to invest in apprenticeships. Employers with a bill of over 3 million will need to pay 0.5% of their total pay bill on the Apprenticeship Levy. However, there is also a levy allowance of 15,000 per year, meaning that the total amount employers will need to pay is 0.5% of their pay bill less 15,000. This will be reported through payroll and included within the normal monthly PAYE payment to HMRC. Further information can be found at Payroll end of year reporting For any employees still working with you after 5 April, you are by law required to provide them with a form P60 by the 31 May. This is a summary of earnings from your employment during the tax year 2016/17 and the employee should use this if they wish to apply for a mortgage/loan, claim overpaid tax or apply for tax credits. If Price Bailey operates your payroll, these will be issued to you in due course. 3

4 Employment allowance For /18 you could get up to 3,000 a year off your National Insurance bill if you are an employer. Your employer s National Insurance liability is reduced by up to 3,000 if you are an eligible employer and the qualifying criteria is available at Auto enrolment The /18 earnings trigger is unchanged at 10,000. If you have not yet staged for auto enrolment you can find your staging date at Price Bailey has an auto enrolment solution which can be of use. Please get in touch with your usual Price Bailey contact for further information on this. Rates and allowances for the tax year Income Tax The standard personal allowance for /18 is 11,500. All employees on an L suffix tax code should have the figure increased by 50. So for example anyone on an 1100L tax code on 6 April will have this increased to 1150L. You should then apply any specific tax code changes you have received from HMRC. Income Tax bands and rates after the Personal Allowance: Basic rate 20% 0 33,500 Higher rate 40% 33, ,000 Additional rate 45% Over 150,000 4

5 ... National Insurance Class 1 NICs: Weekly Lower Earnings Limit (LEL) 113 Weekly Primary Threshold (PT) Weekly Secondary Threshold (ST) 157 Upper Earnings Limit (UEL) 866 Upper Secondary Threshold for under 21s 866 Apprentice Upper Secondary Threshold (AUST) for under 25s 866 Employee rates: Below LEL 0% LEL PT 0% Employer rates: Below ST 0% Above ST 13.8% PT UEL 12% Above UEL 2% Statutory Rates (per week) Statutory Maternity Pay Statutory Paternity Pay Statutory Adoption Pay Statutory Shared Parental Pay Statutory Sick Pay

6 Changes to NMW and NLW from April NLW for the over 25s is being increased to 7.50 per hour. NMW will also increase from the same date to: 21 to 24 year olds to 20 year olds to 17 year olds Apprentices Salary sacrifice changes In the 2016 budget there were two HMRC consultations announced which were based on salary sacrifice for the provision of Benefits In Kind (BIK). The government have been considering limiting the range of BIKs that attract Tax & NI advantages, such as salary sacrifice arrangements. Currently employees save on tax by paying for the benefits before tax is taken, while employers save on paying National Insurance on sacrificed wages. This is all set to change with the Government proposing to remove the relief of Income Tax and employer NI contributions on certain benefits but not employee NI contributions. This will apply for mobile phones, gym memberships, school fees and accommodation. These are seen as luxury benefits. It is proposed to be effective from 6th April, the plans to clamp down on the tax advantages of salary sacrifice and benefit in kind schemes do not affect: Employer-supported childcare and provision of workplace nurseries Employer pension contributions Employer-provided pension advice Cycles and cyclist s safety equipment provided under the cycle to work scheme Low emission cars (with CO2 emissions of up to 75g/km) The measure will be effective for new arrangements from April. Any arrangements already in place at that date will not be subject to the changes until April Companies can still offer these benefits however it will remove much of the incentive for employees. Further information can be found on the Employer Bulletin from HMRC; 6

7 Did you know that within the Price Bailey Group is a team of employment lawyers, who offer a range of services that can help you with your employment law and HR needs? Victoria Pratley Partner vmp@pricebaileylegalservices.co.uk + 44 (0) pricebaileylegalservices.co.uk Anna Harvey Partner ah@pricebaileylegalservices.co.uk + 44 (0) pricebaileylegalservices.co.uk Should you wish to discuss any of the content within this newsletter, or if you have any payroll related queries, please contact your payroll manager at your local Price Bailey office. Our Offices Bishop s Stortford T: +44 (0) Cambridge T: +44 (0) City of London T: +44 (0) Ely T: +44 (0) Mayfair T: +44 (0) Norwich T: +44 (0) Sawston T: +44 (0) The information contained herein is of a general nature and not intended to address the circumstances of any particular individual or entity. Whilst we have made an effort to provide accurate and up to date information, it is recommended that you consult us before taking or refraining from taking action based on matters discussed. This has been sent on behalf of Price Bailey LLP on behalf of its group. Price Bailey LLP is a limited liability partnership registered in England and Wales, number OC The registered office is Causeway House, 1 Dane Street, Bishop s Stortford, Herts, CM23 3BT, where a list of members is kept. For more information about Price Bailey and regulatory details please visit Price Bailey Legal Services LLP is a limited liability partnership registered in England and Wales number OC The registered office is Causeway House, 1 Dane Street, Bishop s Stortford, Herts, CM23 3BT where a list of members is kept. Price Bailey Legal Services LLP is authorised and regulated by the Solicitors Regulation Authority. At Price Bailey - It s all about you The right advice for your business life pricebailey.co.uk