Post on 13-Jan-2016
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Ceridian Customer Conference22 September 2010
HMRC Update
Richard McGuire
Business Education & Support Team
Agenda
• Budgets 2010
• Changes from 6 April 2010
• NPS – An update
• CD-ROM
• Looking ahead
2010 : The year of two Budgets
2010’s Budgets: Communications
• We did not issue an updated CD-ROM following either Budget
• You were sent issue 35 of Employer Bulletin following the March Budget – the last paper copy we will issue
• e-mail alerts
Budget 2010: Announcements affecting employers
Company cars and vans
• For years from 6 April 2010 to 5 April 2015:
– Full relief for cars and vans which cannot produce CO2 emissions when driven
– Reduced charge for cars which have approved CO2 emissions of exactly 75g/km or less
Budget 2010: Announcements affecting employers
Company car tax from 6 April 2012:
• Introduction of new CO2 g/km emissions limits
• Company car tax bands extended down to new 10% band
• All emission thresholds moved down by 5g/km
Budget 2010: Announcements affecting employers
Income Tax from 6 April 2011:
• Personal Allowance to be increased by £1,000 to £7,475
• Basic rate limit - currently £ £37,400 – to be reduced; figure to be announced following publication of the Retail Prices Index for September 2010
Budget 2010: Announcements affecting employers
National Insurance Contributions from 6 April 2011:
• Employees will pay 12% on earnings between the primary threshold and the Upper Earnings Limit; and 2% on earnings above the UEL
• Employers will pay 13.8% on all earnings above the secondary threshold
• The secondary threshold will rise by £21 a week above indexation
Changes from 6 April 2010
Penalties for late payment
In this context, PAYE includes:
• Tax
• National Insurance Contributions
• Construction Industry Scheme deductions
• Student Loan deductions
Penalties for late payment of PAYE
The new penalties:
• apply to any employer or contractor who does not pay on time and in full
• replace the Mandatory Electronic Payment surcharge currently applied only to ‘large’ employers
• apply to payments due on or after 19/22 May 2010…but will be assessed after the end of the tax year
More information at:
www.hmrc.gov.uk/paye/problems-inspections/late-payments.htm
Penalties for late payment of PAYE: When we will charge penalties
• Do not expect a letter each time you pay late
• We will review employers’ and contractors’ payment records after the end of the 2010-2011 tax year; and
• Issue first penalties from April 2011
Penalties for late payment of PAYE: How to avoid them
Pay on time!
• don’t leave payment to the last minute
• check on what day the 19th or 22nd falls
• consider changing your payment method
• sign-up for e-mail alerts
– visit www.businesslink.gov.uk and search ‘key filing dates’
Penalties for late payment of PAYE
If you face difficulties paying:
• Let us know as quickly as possible – but before the payment is due
• Contact the Business Payment Support Service on 0845 302 1435
• Have to hand:
– Your tax reference number(s)
– Details of the tax involved
– Details of when you expect to be able to pay
Equalisation of State Pension age (SPa)
• From 6 April 2010 the age at which women reach SPa will gradually rise to become the same as it is for men – 65
• The change will be phased in between April 2010 and April 2020
• All women born between 6 April 1950 and 5 April 1955 are affected
• All women born on or after 6 April 1955 will reach SPa at age 65
Equalisation of State
Pension age (SPa)
• DWP is writing to all women affected, advising them of their revised pension age
• Women should notify their employers
• NICs are due from women over age 60 up to their new SPa
• Category C, employer-only NICs are due only in relation to employees working beyond their SPa
Equalisation of State Pension age (SPa)
For further information, go to:
Employers
• www.hmrc.gov.uk/guidance.cwg2.pdf
• www.hmrc.gov.uk/paye/employees/changes/pension-age.htm
Employees• http://pensions.direct.gov.uk/en/state-pension-age-calculator/home.asp
NPS – An update
National Insurance and PAYE Service (NPS)
• In June 2009, NPS replaced the 25 year old PAYE IT system (COP)
• Customer-centric so easier for HMRC as well as customers
• Delivers a faster, more efficient and accurate service
• In the majority of cases, queries can be answered at first point of contact, saving time and resources
• Greater accuracy in our records as we update them with information from our customers
• Reduces the burden on employers…
• …but the transition from COP to NPS has highlighted some issues
National Insurance and PAYE Service (NPS)
Issues:
• Annual Coding
• Importance of quality of data
• End of Year Reconciliation
Notifying changes in personal information
• It is vital that HMRC has correct personal information
• National Insurance Number
• Date of Birth
• Full name
• Address
• Daytime telephone number
• Employees and pensioners can now e-mail HMRC to tell us of changes to the final three
• Go to www.hmrc.gov.uk/individuals/change-of-circs.htm
• This will reduce the number of MS120 forms we send you
CD-ROM
CD-ROM
• Download the September update from:
www.hmrc.gov.uk/employers/cdrom/index.htm
• Don’t forget to register for e-mail alerts at:
www.hmrc.gov.uk/paye/forms-publications/register.htm
CD-ROM 2010: Help and guidance
Go to
www.hmrc.gov.uk/employers/cdrom/index.htm
for updates and Frequently Asked Questions
Watch this space for future developments…
Looking ahead
National Minimum Wage: Changes from 1 October 2010
• The main rate of NMW will be payable to workers aged 21 and over
• Revised rates come into force for all age bands
• There will be a new NMW rate for apprentices
NMW rates from 1 October 2010
NMW rate Rate from October
Workers aged 21 and above £5.93
Workers aged 18-20 years £4.92
Workers under 18 years and over compulsory school age
£3.64
Apprentices £2.50
Accommodation offset rate (weekly maximum)
£32.27
Accommodation offset rate (daily) £4.61
Electronic P60s
• Employers to have the option to provide P60 information in paper or electronic format
• The change comes into effect for the tax year 2010-11 onwards, meaning that the first P60 that can be provided electronically will be that for the year ending 5 April 2011
• The information recorded on form P60 is not changing
• HMRC publication RD1 (Substitute forms P60) will be updated
Additional Statutory Paternity Pay and Leave
Will apply to:
• Parents of babies due to be born on or after 3 April 2011; and
• Partners of children matched for adoption on or after the same date
Additional Statutory Paternity Pay and LeaveFrom August 2010:
• Technical specifications for Payroll software available
From October 2010:• Guidance for employers and workers at
• www.hmrc.gov.uk
• www.businesslink.gov.uk
• www.direct.gov.uk
From April 2011:• Updated Helpbook E19 and ASPP calculator available at:
• www.hmrc.gov.uk
Shaping the future?
‘Improving the operation of Pay As You Earn (PAYE)’
• Discussion document issued 27 July 2010
• Comments to be sent by 23 September 2010
• Access via www.hmrc.gov.uk/consultations/index.htm
• Discusses:
• Real Time Information; and
• Centralised Deductions
Any questions?