As previously advised the allowance available to employers to set against their employers National Insurance liability for the year has increased to £3,000 from 6 April 2016 and no action is required if you claimed the allowance for 2015/16. However from 6 April 2016 limited companies, where the director is the only employee, will no longer be entitled to claim the allowance.
The Employment Allowance is increasing from £2,000 to £3,000 on the 6th April 2016. This is good news for employers, but bad news if you’re the only employee in a company, and also the director, as your company will no longer be eligible for the NICs Employment Allowance.
This means that if as a sole director you pay yourself £11,000 per year to make use of the personal allowance, then the company will pay just under £400 per year in Employer’s National Insurance.
HMRC has launched a new secure online service called Personal Tax Accounts. The idea is that individuals, once registered, will be able to log in and see details of their employment(s) and their tax codes for each source of employment. They will also be able to generate an estimate of any tax deductions.
The benefits of this system are that if any personal details are incorrect or the tax codes are wrong, you will be able to adjust these online, instead of spending hours waiting to speak to a HMRC advisor.
Do you know your staging date?
Overtime & holiday pay
Workers have won an important case at the Employment Appeal Tribunal that overtime should count when calculating their holiday pay entitlement.
What is this about?
Up until now, the EU Working Time Directive which says workers should receive their 'normal' pay when they take time off has been interpreted as saying that holiday pay should be at an employee's basic rate of pay, which means any additional payments for regular overtime aren't included.
The Good News
From the 6 April 2015, the rate of employer Class 1 secondary NICs for employees under the age of 21 will be 0% up to the new ‘Upper Secondary Threshold’ (UST) which will be the same as the Upper Earnings Limit (UEL) for 2015/16. Earnings above this threshold will have employers NIC applied to them as usual.
The NIC on expenses and benefits (Class 1A) are not affected by this change and should be collected and reported as normal.
This is a guest blog from Gregg Crawford of Informed Financial Planning
For years pensions have received a bad press, brought about by perceived poor returns, mis-management and un-realistic guarantees.
Earlier this year, HMRC announced that the penalties for late returns of payroll information (RTI) would start from October 2014 instead of April 2014. If you operate your own payroll, make sure that your RTI submissions are made on time to avoid an automatic penalty.
Remember that the RTI submission should normally be made on or before the date when the wages or salaries are paid to the employees.
HMRC are rolling out a new online service for employees. The new service that will be available from the end of September and will allow the employee to add or amend their company car details online.
This is the beginning of a new service that will eventually allow employees to amend information that affects their own tax code online.