Payroll Update – February 2016

THE LIVING WAGE

The new living wage from April 2016 will be £7.20 per hour for those aged over 25. This is an increase of 7.5% on the current National Minimum Wage rate of £6.70 for over 25’s.

It is recommended that you review your current payroll costs to ascertain what impact, if any, the new rates will have on your business.

The national living wage is planned to increase to £9 per hour by 2020 which is an increase of 34% on today’s rates.

HMRC are setting up a new unit to deal with employers who do not comply. Employers could face fines for non compliance.

The following steps should be taken to ensure you are ready for the new rules:

  1. Check that adequate record keeping procedures are in place to identify employees and their ages.
  2. Ensure your payroll procedures are suitable.
  3. Advise staff of new rates.
  4. Ensure staff under 25 are being paid at least the National Minimum Wage rate.

Many employers already pay the living wage and may have already signed up to the living wage foundation. You can find more information at www.livingwage.org.uk.

RTI CONCESSIONS FOR SMALL EMPLOYERS TO END FROM 6 APRIL 2016

The Government announced in the Autumn Statement 2015 that the current two year temporary reporting relaxation will end as planned on 5 April 2016. The relaxation permitted employers who at 5 April 2014 employed no more than 9 employees, to report their PAYE information for the tax month ‘on or before’ the last payday in the tax month instead of ‘on or before’ each payday. This will align the reporting obligations for micro employers with all other employers who are currently required to report payments ‘on or before’ each payday. As a consequence ‘Late reporting reason code E’ will not be valid from 6 April 2016.

END OF YEAR PAYE RETURN REMINDER

Under RTI the end of year form P35 was replaced by the Final Full Payment (FPS) submission. Send your final FPS on or before your employees’ last payday of the tax year (5 April) instead of the old 19 April deadline. Remember to put ‘Yes’ in the ‘Final submission for year’ field in your payroll software.

If you require any further information or would like to discuss any of the above, please contact us.

 

 

Payroll Newsletter

Click on the link opposite to download our payroll newsletter which features articles on:

  • Pensions auto enrolment and what you should be doing to ensure you comply with the new rules
  • Employment allowance from April 2016
  • Why you should consider using our payroll bureau to process your payroll
  • The living wage which will be introduced from April 2016
  • Changes to the reporting of expenses and benefits from April 2016
  • Pensions auto enrolment course on 11 February 2016 – places are still available

We hope you find the newsletter useful.

If you require any further information or would like to discuss any of the above, please email us and we will contact you.

 

 

 

 


 

 

 

7.5% increase in income tax on dividends to proceed

The legislation to introduce the new system of dividend taxation announced in the 2015 Summer Budget has now been included in the draft Finance Bill.  Although individuals will be able to receive £5,000 of dividend income tax free each year from 2016/17, once that has been used up there will be a 7.5% increase in the rate of tax on dividends so you may wish to consider increasing your dividend payments before 6 April 2016.

Please contact us for further information or to discuss your options.

Tax Return and other important tax deadlines for January/February 2016

 

Date What’s Due
19 January PAYE & NIC deductions, and CIS return and tax, for month to 5/1/16 (due 22 January if you pay electronically)
31 January Deadline to file 2015 SA tax return online
31 January Income tax balancing payment for 2014/15, plus CGT for 2014/15
31 January Income tax 1st payment on account for 2015/16
1 February Corporation tax for year to 30/4/15

Have you submitted your tax return or paid any income tax/capital gains tax due for the tax year ended 5 April 2015?   If not these need to be received by HM Revenue & Customs before 31 January, 2016 to avoid incurring any penalties or interest.

You can pay any income tax due online at https://www.tax.service.gov.uk/pay-online/self-assessment. To do this you will need your UTR (unique taxpayer reference number) followed by a ‘K’.  This can be found on your Self Assessment bill or if you haven’t received a bill from HM Revenue and Customs, please contact us.   HM Revenue & Customs require cleared funds before 31 January, 2016 so please allow at least three bank working days for the funds to clear.  Please note that there is a fee for payments made by credit card but payments by debit card are free.

If you need any assistance in preparing your 2015 Tax Return please contact your local Saint & Co Office as soon as possible.

Scottish rate of income tax with effect from 6 April 2016

HM Revenue and Customs have announced that the Scottish rate of income tax will come into effect from  6 April 2016 and will affect all Scottish tax payers, and all employers with employees who live in Scotland.

HM Revenue and Customs have already started to contact customers living in Scotland, where their records show this as their main address, to inform them they have been identified as being a Scottish taxpayer.

What you need to know

Read more →

Opening Times Christmas & New Year 2015/16

merry_christmas

Merry Christmas and a Happy New Year from everyone at Saint & Co.

Our offices’ opening times over the holidays are:

Ambleside Office Closes at 12 noon on Thursday, 24th December 2015

Reopens on Tuesday, 5th January 2016

Annan Office Closes at 12 noon on Thursday, 24th December 2015

Reopens on Tuesday, 5th January 2016

Carlisle Office Closes at 12 noon on Thursday, 24th December 2015

Reopens on Tuesday, 5th January 2016

Cockermouth Office Closed from Thursday, 24th December, 2015

Reopens on Monday, 4th January 2016

Dumfries Office Closes at 12 noon on Thursday, 24th December 2015

Reopens on Tuesday, 5th January 2016

Millom Office Closes at 5 pm on Thursday, 24th December 2015

Reopens on Monday, 4th January 2016

Saint Financial Services Closes at 12 noon on Thursday, 24th December 2015

Reopens on Tuesday, 5th January 2016

Penrith Office Closes at 12 noon on Thursday, 24th December 2015

Reopens on Monday, 4th January 2016

Whitehaven Office Closes at 12 noon on Thursday, 24th December 2015

Reopens on Monday, 4th January 2016

Wigton Office Closes at 12 noon on Thursday, 24th December 2015

Reopens on Monday 4th January 2016

Capital allowances: changes to the Annual Investment Allowance on 1 January 2016

Since its introduction in April 2008, the Annual Investment Allowance (AIA) has been subject to numerous changes. 1 January 2016 sees the latest change to the AIA, with the allowance set to fall from £500,000 to a new permanent level of £200,000. This reduction will undoubtedly have an impact on many businesses and the timing of expenditure will be critical when maximising claims under the AIA.

Download our factsheet on the right hand side of this page for an overview of the capital allowances system and information on the upcoming changes to the AIA, as well as advice to help businesses plan ahead so that they receive the maximum tax benefit.

Contact your local office if you wish to discuss the contents of the factsheet or if you would like any further information or advice.

ADVISORY TAX FREE FUEL RATES FROM 1 DECEMBER 2015

COMPANY OWNED VEHICLES

HM Revenue and Customs have announced revised tax free advisory fuel rates from 1 December, 2015 which may be paid for business journeys in a car owned by the business. Rates for the previous quarter are shown in brackets.

Engine size Petrol Diesel LPG
1,400 cc or less 11 p (11p) 7p (7p)
1,600 cc or less 9p (9p)
1,401 cc to 2,000 cc 13 p (14p) 9p (9p)
1,601 cc to 2,000 cc 11p (11p)
Over 2,000 cc 20p (21p) 13p (13p) 13p (14p)

These rates may be used in the following circumstances:-

  1. Where employers reimburse for business travel in company cars.
  2. Where employers provide fuel for company cars but employees are required to reimburse the cost of fuel for private use.

INPUT VAT CLAIMS ON MILEAGE PAID FOR COMPANY CARS OR EMPLOYEE OWNED VEHICLES

HM Revenue & Customs will accept the above figures for claiming input VAT on fuel for company cars, provided a VAT receipt is available to cover the cost of the fuel. They will also accept use of the above rates by the employer when calculating input VAT on the fuel element for employees using their own vehicles and claiming mileage under the tax free approved mileage rates for business travel of 45p for the first 10,000 miles and 25p thereafter.

If you have any queries regarding the above or require any further information please  contact us.