Employers, please be careful about making deductions from wages that reduce the gross amount below the relevant NMW rate. For example, you may deduct sums for employee uniforms, staff meals, childcare vouchers, or even for places at child nurseries where the employee also works.
If you provide such benefits this needs to be done outside of the payroll function. Our payroll team can advise on the best way to structure this.
If, as an employer, you charge workers rent where accommodation is provided, the amounts of rent which are permitted as a deduction from the NMW rate are strictly limited by the daily accommodation offset which is £9.10 from 1 April 2023.
Where the NMW rules are broken HMRC can impose penalties of up to 200% of the amount of NMW underpaid, up to £20,000 per worker.
Jackie Hemus, Payroll Manager
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