Real Time Information

Real Time Information (RTI) is here!  It will completely change the way employers and pension providers send HMRC employee information. Under Real Time Information (RTI) employers and pension providers will tell HMRC about tax, NICs and other deductions when or before the payments are made, rather than at the end of each tax year.

HMRC State that RTI will:

• make the PAYE process simpler and less burdensome for employers
• reduce costs for HMRC and enable it to deal with non-compliance (such as late payment and debt collection) more effectively
• support the payment of Universal Credits
• make PAYE more accurate for individuals, over time reducing the number of bills and repayments sent after the end of the tax year
• reduce tax credits error and fraud

Employers and pension providers will send this information to HMRC Online.

For further information visit www.hmrc.gov.uk/rti/index.htm

Increase in the National Minimum Wage Rate (all UK)

From 1 October 2012, new national minimum wage (NMW) rates will come into force.

The NMW applies to nearly all workers and sets hourly rates below which you must not allow pay to fall.

For pay reference periods (PRPs) beginning on or after 1 October 2012, you will have to pay all eligible workers the following:

• £6.19 an hour to workers aged 21 and above ('the main rate')
• £4.98 an hour to workers aged 18 - 20
• £3.68 an hour to workers aged 16 - 17 above school leaving age but under 18

NMW for apprentices

The apprentice rate, for apprentices under 19 or 19 and over and in the first year of their apprenticeship, will increase to £2.65 an hour.

Currently such apprentices are not entitled to the NMW.

To qualify to receive the NMW, the apprentice must either:

• work under a contract of apprenticeship
• be employed on a government-funded training scheme that is treated as an apprenticeship for NMW purposes.

To find out more visit:

www.businesslink.gov.uk

National Payroll Week 2011

It's National Payroll Week this week and The Paycompany is celebrating it by holding a coffee morning on Friday 9th September.

The office has been decorated with posters and balloons provided by the Chartered Institute of Payroll Professionals.

We would love to see you pop in anytime between 10 and 12 o’clock and have a chat over coffee and try one of our delicious chocolate cupcakes.

http://www.facebook.com/#!/photo.php?fbid=257197617636353&set=a.257196647636450.61426.158298584192924&type=1&theater

PAYE tax code applied to payments to ex-employees after form P45 issued

From 6 April 2011 the default tax code employers are required to operate on a payment made to an ex-employee after their P45 has been issued has changed from code BR (20% Basic Rate) to 0T (zero T) on a non-cumulative (Week 1/ Month 1) basis.  

Under the Basic Rate tax code significant underpayments arose for many higher (40%) and additional (50%) rate taxpayers and presented HMRC with compliance issues and customers with underpayments at a later date.

Under code 0T W1/M1, tax is recovered at the basic, higher and additional rates of tax as appropriate. Where the additional payment is being made outside of the normal payroll run the tax code operated on the additional payment will not result in the right amount of tax being deducted in all cases. However, code 0T does in general bring the individual closer to the correct tax due figure when the year as a whole is reconciled, and protects both the exchequer and the individual from potentially large underpayments at the end of the tax year.

Automatic Enrolment , Pension Personal Accounts
National Employment Savings Trust ( NEST )

Under the Pensions Act 2008, plans were put in place to reform workplace pensions. The changes will be introduced from October 2012 and will mean that every employer will be required to automatically enrol their workers into a qualifying pension scheme if they are not already enrolled in one (“auto-enrolment”), and to contribute to their pension. This will include all workers who: are at least 22; have not yet reached state pension age; and earn more than the minimum earnings threshold (likely to be £7,475 a year).

A new pension scheme called the National Employment Savings Trust (NEST) has been established to provide a simple, low-cost pension scheme. NEST is open to all employers. Employers will also be able to use an existing pension scheme (if it qualifies or its criteria are amended to meet the qualifying criteria); or set up a new scheme; or use a combination of these options. Employers will be required to register with The Pensions Regulator, which will oversee the implementation of auto-enrolment.

Further information can be found at

http://www.direct.gov.uk/en/Pensionsandretirementplanning/DG_183783

http://www.nestpensionadvice.co.uk

Rates & Allowances Changes for 2011/12

Personal Allowance to increase by 1K to £7475 (under 65 years)

Penalties for Late Payment of PAYE to HMRC

This tax year HMRC have introduced penalties for late payment of PAYE.  PAYE includes Income Tax, National Insurance Contributions, Construction Industry Scheme deductions and Student Loans.

Payments by post must reach HMRC by the 19th of each month or by the 22nd if you make electronic payments to avoid penalties.  However, smaller businesses may be able to send the amounts due every 3 months if your average monthly payments are likely to be less than £1,500.

http://www.hmrc.gov.uk/paye/problems-inspections/late-payments.htm

2010/11 PAYE Rates & Allowances

SPECIAL OFFER – New Clients first payroll processed for FREE !

New payroll clients (employers with 50 or less employees)
First payroll processed Free of Charge.

Quoting promotional code - webpayfoc