Category Archives: Payroll Press Articles

Are you aware of the new payroll changes? Tips, tricks and more for employers

Paying your workforce should be simple. But with ever-changing legislation and regulation, payroll can be one of the more tricky aspects of running a business. With this in mind, we’re here to help you get to grips with upcoming changes which all employers should be aware of.

Personal Allowance

The Personal Allowance – the income employees can take tax-free – is increasing to £11,850 in April 2018, meaning the new threshold (starting point) for PAYE is £228 per week or £988 per month. Also take note that the new emergency code will be 1185L.

UK Rate % Bandwidth
Basic Rate 20 £1 to £34,500
Higher Rate 40 £34,501 to £150,000
Additional Rate 45 £150,001 and above

Pension Increases

The minimum amounts you and your staff must pay into your workplace pension scheme will be increasing as of the 6 April 2018.

The total contribution will rise from 2 per cent to 5 per cent. Please refer to the table below to see the minimum contributions:

Date Effective Employer Minimum Contribution Staff Contribution Total Minimum Contribution
Currently until 5 April 2018 1% 1% 2%
6 April 2018 – 5 April 2019 2% 3% 5%
6 April 2019 onwards 3% 5% 8%

Moore Thompson Payroll Bureau will automatically make the statutory increases from the first pay period following 6 April 2018. It’s advisable to let your employees know about the change before it happens. Get in touch for a free template letter.

National Minimum Wage

As planned, the National Minimum Wage (NMW) will increase again in April. You can find all the new rates below.

Age Group National Minimum Wage Rate
25 + (National Living Wage) £7.83 per hour
21 – 24 £7.38 per hour
18 – 20 £5.90 per hour
Under 18 (but above compulsory school leaving age)   £4.20 per hour
Apprentices Under 19 £3.70 per hour
Apprentices aged 19+ (in first year of apprenticeship) £3.70 per hour

Please ensure you are paying your employees in-line with the new rates from April 2018. For existing clients, we will check the legal minimums are being met providing we hold details of hours worked or hourly rates. If you’re interested in this service, please get in touch.

Statutory Payments

Employers are legally obliged to pay employees the statutory rate if they fall ill or have a child. It’s important you keep an open channel of communication about these payments and who is entitled to them. Please find the new rates below.

Statutory Payment Type Payment Amount
SMP (Statutory Maternity Pay) First 6 weeks at 90% of Average Weekly Earnings (AWE)  Thereafter £145.18 per week (or 90% of AWE, whichever is lower)
SPP (Statutory Paternity Pay) £145.18 per week (or 90% of AWE, whichever is lower)
SAP (Statutory Adoption Pay First 6 weeks @ 90% of Average Weekly Earnings (AWE) Thereafter £145.18 per week (or 90% of AWE, whichever is lower )
SSP (Statutory Sick Pay) £92.05 per week

Please note the payments above are subject to meeting qualifying criteria. Please contact Moore Thompson Payroll Bureau to find out more.

Are your employees aware of Pension Advice Vouchers?

  • Up to 1.3 million workers are eligible to receive tax-free perk
  • Can save up to £310
  • But many employers yet to offer scheme

More than one million people currently seeking professional retirement advice could be entitled to a new tax perk through their workplace.

Pension Advice Vouchers, launched in November last year, allow employees who have paid for financial advice to swap £500 of taxable salary for a £500 tax-free reimbursement.

If an employee spends more than £500 per annum on pensions advice, they could save £160 if you earn between £12,000 and £46,000. Higher and additional rate taxpayers will save more – around £210 and £310 respectively. 

Adam Price, of professional advisor comparison site VouchedFor, said: “Very few employers are offering the scheme, hence few employees are aware of it.

“Access to good financial advice is so important right now. This government initiative reduces the cost by up to 62 per cent. I would urge all employees to lobby their employers for access to this scheme.

“It’s especially urgent for the 1.2 million employees who already pay for advice each year. They have only until April if they want to capture their first year’s savings.”

Brian Henderson, of human resources consultancy Mercer, added: “The scheme can work really well in principle, but we haven’t seen masses of interest. If employees want it they should argue very heavily that they want it in place,” he said.

“There’s an underlying challenge with employers offering an advisory service such as the vouchers and highlighting advisers to choose from as they worry the advice could go wrong and they’re on the hook for it.

“Also, there’s probably just a lack of knowledge. It hasn’t been well publicised.”

How it works:

  1. Employee agrees to sacrifice up to £500 salary which would have been taxed via PAYE
  2. Pension Advice Vouchers service checks with adviser that £500 has been paid for pensions advice
  3. Employer approves request and transfers funds via Pension Advice Vouchers

Keep track of your legal obligations by visiting www.moorethompson.co.uk. For more information on any of the articles discussed in Payroll, contact one of our payroll & HR experts here.

Your personalised Payroll diary (Jan – Apr)

31 January 2018
Deadline for online self-assessment tax return (2016/17)

19 February 2018
Deadline date for payment of PAYE Tax and National Insurance to HMRC Accounts Office by non-electronic method. (Every 19th of the month thereafter)

20 February 2018
Deadline date for payment of PAYE Tax and National Insurance to HMRC Accounts Office by electronic method. (Every 22nd of the month thereafter)

13 March 2018
Spring Statement

30 March 2018
Bank holiday

01 April 2018
National Minimum Wage increases

02 April 2018
Bank holiday

04 April 2018
Deadline to report gender pay gap (250 or more employees)

06 April 2018
Workplace pension contributions increase

What you may have missed…

01 April 2017
New National Minimum Wage rates apply. Find out more here.

06 April 2017
Government officially launch Apprenticeship Levy. Find out more here.

01 October 2017
Automatic enrolment staging date for new employers. After this date, new employers will have pension duties as soon as their first member of staff starts work.

Keep track of your legal obligations by visiting www.moorethompson.co.uk. For more information on any of the articles discussed in Payroll, contact one of our payroll & HR experts here.

HMRC steps up fight against minimum wage dodgers

  • HMRC to receive £5.3 million in extra funding to enforce national minimum wage
  • Compliance team expands to more than 360 members
  • Despite this, more than 362,000 jobs paid less than the NMW in April 2016

According to the Government’s latest Labour Market Enforcement Strategy report, HM Revenue & Customs (HMRC) is to receive an additional £5.3 million of funding in 2017/18 to ensure businesses are paying employees the national minimum wage (NMW) and national living wage (NLW).

This follows on from a previous increase of £20 million in 2016, which has allowed the team to expand to more than 360 members of staff.

According to the report, it is estimated that there were 362,000 jobs paying less than the NMW or NLW in April 2016, which equates to around 1.3 per cent of all UK employee jobs.

Within its findings, the Government flagged up accommodation and food services, the wholesale and retail trade, and other services such as hairdressers and beauty as the worst offenders.

Shockingly, of those who were underpaid, more than 40 per cent received wages that were at least 50p an hour below the NLW.

It is thought that this high rate of underpayment was what led to the increase in penalties on arrears from 100 per cent to 200 per cent in April 2016.

Currently, HMRC enforces non-compliance with the statutory wage legislation in five ways:

  • Getting the wage arrears paid to the worker;
  • Civil penalties of up to 200 per cent of the arrears owed per worker up to £20,000;
  • Naming scheme under which the Department for Business, Energy and Industrial Strategy (BEIS) will name all employers who owe their workers over £100;
  • The new regime of labour market enforcement undertakings and orders;
  • And criminal investigation possibly resulting in a prosecution by the Crown Prosecution Service (CPS).

Depending on the severity of the case employers can face one or all of the penalties listed above, so it pays to ensure that a business is compliant with the current NMW and NLW requirements.

Keep track of your legal obligations by visiting www.moorethompson.co.uk. For more information on any of the articles discussed in Payroll, contact one of our payroll & HR experts here.

Moore Thompson opens the door to experienced payroll manager

Moore Thompson has welcomed an experienced payroll expert to help head up its growing team.

Kieran Smith joins the firm from Boston College where he worked his way up from apprentice to the position of Payroll Manager.

He will take on a similar role at Moore Thompson, drawing upon his experience and prestigious Higher National Diploma in Payroll Management to assist clients.

Speaking about his appointment, Kieran said: “I am really looking forward to helping lead the payroll team at Moore Thompson, which continues to see increased interest in its services from local businesses.

“I hope that I can build upon the success of my predecessors and continue to deliver the high levels of service that clients have come to expect of the practice.”

In his new position, Kieran will play an important role in continuing to support Moore Thompson’s clients with automatic-enrolment and the management of workplace pensions.

Mark Hildred, Managing Partner at Moore Thompson said: “We are delighted to be welcoming Kieran to the firm. He comes to us with lots of experience and a strong local connection to the area, which is always beneficial to us when working with our clients’ in the region.”

Moore Thompson also welcomes Siri Pabby Chetty to its payroll team, as it continues to grow to meet clients’ requirements.

Keep track of your legal obligations by visiting www.moorethompson.co.uk. For more information on any of the articles discussed in Payroll, contact one of our payroll & HR experts here.

Your personalised Payroll diary

19 October 2017
Deadline date for payment of PAYE Tax and National Insurance to HMRC Accounts Office by non-electronic method. (Every 19th of the month thereafter)

20 October 2017
Deadline date for payment of PAYE Tax and National Insurance to HMRC Accounts Office by electronic method. (Every 22nd of the month thereafter)

31 October 2017
Deadline for paper self-assessment tax return

25 December 2017
Bank holiday

26 December 2017
Bank holiday

01 January 2019
Bank holiday

What you may have missed…

01 April 2017
New National Minimum Wage rates apply. Find out more here.

06 April 2017
Government officially launch Apprenticeship Levy. Find out more here.

01 October 2017
Automatic enrolment staging date for new employers. After this date, new employers will have pension duties as soon as their first member of staff starts work.

Keep track of your legal obligations by visiting www.moorethompson.co.uk. For more information on any of the articles discussed in Payroll, contact one of our payroll & HR experts here.

Businesses not claiming apprenticeship vouchers, figures show

Almost half of businesses paying the apprenticeship levy are writing their payments off as tax, according to new figures – amid concerns that firms are not reaping the advantages of extra training.

The Department for Education (DfE) revealed that just 10,500 eligible businesses are registered to receive apprenticeship vouchers, compared with the 19,150 paying the levy.

The levy is designed to fund the Government’s pledge to create three million apprenticeships by 2020. Employers with a wage bill of £3 million or more each year are required to pay the levy – charged at 0.5 per cent of their annual pay bill.

All organisations have an apprenticeship levy allowance of £15,000 each year, meaning they only pay the levy on any amount over £3 million.

Joe Dromey, senior research fellow at the Institute for Public Policy Research, told the HR publication People Management that the low uptake suggested employers were not engaging with the levy as hoped.

“While these are early days, with the levy introduced just six months ago, these figures will be a cause for concern,” he said.

“They seem to validate concerns raised around the lack of awareness of the levy – even among firms paying it – and that many levy-paying employers will simply see it as a tax and write it off.”

Elizabeth Crowley, skills adviser at the CIPD, added: “In our view the government needs to be doing more work to ensure employers are making a choice in not using the levy, instead of being unaware of it. It is equally important that if there is an underspend, the funds are ring-fenced and used for supporting employer training, as there is a danger it could simply go back into the government’s coffer, and not be used to increase skills training and investment in the UK economy.”

A separate study, published by the British Chambers of Commerce earlier this month, found that one in four firms had no understanding of how the levy worked or how their company would respond.

Keep track of your legal obligations by visiting www.moorethompson.co.uk. For more information on any of the articles discussed in Payroll, contact one of our payroll & HR experts here.

No more credit card PAYE penalty payments

HM Revenue & Customs (HMRC) has confirmed that, as of 13 January 2018, employers will no longer be able to use personal credit cards to settle outstanding PAYE late payment penalties, PAYE settlement agreements or Construction Industry Scheme (CIS) late filing penalties.

However, from that date HMRC will accept full payment by company credit card or debit card but not part payment, so any employers who are unable to make full payment by card will have to find another way to pay, such as telephone banking, CHAPS or Bacs. Employers should note that HMRC will charge a fee for payment by credit card.

All payments must include the 14 or 15-character payment reference that begins with X and is on the payslip. If an employer does not have a payslip for the worker, they should still have a payment reference from HMRC, which they must include in the payment. However, it is important to get this right, as an incorrect reference could delay it.

They will also need to factor in the time it takes for the money to get to HMRC when they pay. The slowest way is via direct debit, which takes five working days to arrive. However, the agency has said it will accept payment on the date made, not the date it reaches them, as long as the payment was made between Monday to Friday.

There is also the cheque in the post method. Employers paying this way should allow three working days for the payment to reach HMRC and must ensure that the cheque is not folded and that any documents are not fastened together.

Employers who currently pay at the Post Office should note that this facility will be withdrawn on 15 December 2017.

Keep track of your legal obligations by visiting www.moorethompson.co.uk. For more information on any of the articles discussed in Payroll, contact one of our payroll & HR experts here.

Can your business afford long-term absence?

Can your business afford long-term absence? Can your employee afford to be absent for a long period through no fault of their own?

An estimated 137.3 million working days were lost to sickness absence in 2016 – over 30 per cent of which were due to long-term illness (four weeks or more). This equates to roughly 4.3 days per worker, with the mean annual cost of absence totalling £522 per employee.

Research also suggests that being out of work for long periods of time is damaging to both social and financial well-being as well as health.

Has your employee been off for more than 4 weeks?

Work helps people stay mentally fit and focused. But if they are unfortunate enough to fall ill and be subject to an absence of four weeks or more, get support with a Government funded initiative offering free Occupational Health Assessments to help employees return to work.

There are two elements to the Fit for Work Service for Employers, Employees and GP’s:

  • Free, expert and impartial work-related health advice via its website and telephone line
  • Referral to an occupational health professional for employees who have been, or who are likely to be, off sick for four weeks or more.

The occupational health professional will identify obstacles preventing the employee from returning to work and produce a Return to Work Plan tailored to the employee’s needs.

Referrals can be made by GPs, and employers can refer an employee if they have not yet been referred by their GP after four weeks of absence.

Employees will need to consent to be referred to Fit for Work and for the Return to Work Plan to be shared with their GP and employer.

For more information please visit the Fit For Work Service website.

Keep track of your legal obligations by visiting www.moorethompson.co.uk. For more information on any of the articles discussed in Payroll, contact one of our payroll & HR experts here.

Watch out! Fake HMRC emails are about

Moore Thompson has noticed a marked increase in the number of clients receiving suspect email from HM Revenue & Customs (HMRC).

While some of these may well be genuine, most are not and are designed to trick you into thinking otherwise.

To help you stay safe from fraudsters, we have compiled a quick guide below:

HMRC emails will never:

  • notify you of a tax rebate
  • offer you a repayment
  • ask you to disclose personal information such as your full address, postcode, Unique Taxpayer Reference or details of your bank account
  • give a non-HMRC personal email address to send a response
  • ask for financial information such as specific figures or tax computations, unless you’ve given us prior consent and you’ve formally accepted the risks
  • have attachments, unless you’ve given prior consent and you’ve formally accepted the risks
  • provide a link to a secure log in page or a form asking for information – instead HMRC will ask you to log on to your online account to check for information.

Fraudsters target multiple people at any one time so be cautious of emails that have generic greetings such as ‘Dear Customer’. HMRC emails will always:

  • usually use the name you have provided to them, other than where you sign up to HMRC subscription services
  • always include information on how to report phishing emails to HMRC.

If you suspect that you have received a fraudulent email from HMRC, report it to phishing@hmrc.gsi.gov.uk.

For more information on HMRC phishing emails and bogus contact, please click here.

Keep track of your legal obligations by visiting www.moorethompson.co.uk. For more information on any of the articles discussed in Payroll, contact one of our payroll & HR experts here.