10 key reasons to move from HMRC Basic PAYE Tools to BrightPay

1. BrightPay is HMRC recognised
2. RTI is fully automated
3. BrightPay will automatically import your HMRC Basic PAYE Tools data
4. BrightPay will handle all auto enrolment tasks (at no extra cost)
5. BrightPay includes the NEST API, meaning the upload of auto enrolment data is automated
6. BrightPay will perform a pre staging assessment of your workforce to establish how much auto enrolment is going to cost and to determine if you need to register with a pension scheme
7. Payslips can be emailed to employees and will contain details of any pension deductions
8. You can use postponement, giving you more time to get a pension scheme in place
9. BrightPay is free for up to 3 employee records or £89 plus VAT per annum for a single employer with unlimited employees
10. Support is included in this price

This list is not exhaustive and only covers the key points.

Posted byPaul ByrneinAuto EnrolmentHMRCPayroll Software

Auto enrolment - Autumn statement changes affecting minimum contribution schemes

The Government has announced plans to adjust, by about 6 months, the date on which the minimum pension contribution levels increase.

Phase 2 (when the minimum contributions increase to 3% employee and 2% employer) was scheduled for 1st October 2017 and phase 3 (when they increase to 5% employee and 3% employer) was scheduled for 1st October 2018.

Phase 2 will now start on 6 April 2018† and phase 3 will start on 6 April 2019† (†subject to parliamentary approval). This is not a delay to the roll out of automatic enrolment, but a measure to give all employers, and smaller employers in particular, more time to prepare for the increases and to reduce the administrative burden by aligning the changes with the start of each tax year.

This change will also make it considerably easier for payroll software to deal with the uplifts as they are now aligned to payroll years.

Posted byPaul ByrneinAuto EnrolmentPayroll Software

Tax Rates, Tax Credit Rates and Thresholds 2016-17 Tax Year

HMRC have announced the tax rates, tax credit rates and thresholds for the 2016-17 tax year which those processing payroll for employees should be aware of.

Tax Rates and Tax Bands

There are no changes in the basic rate, higher rate or additional rate of taxes at 20%, 40% and 45% respectively.

The basic rate band has increased by £215 from £0-£31,785 in 2015-16 to £0-£32,000. The higher rate has increased from £31,786-£150,000 to £32,000-£150,000 where the additional rate remains at over £150,000.

Personal Allowances

From 2016-17 onwards, all individuals will be entitled to the same personal allowance, regardless of the individuals’ date of birth. This personal allowance is £11,000, an increase of £400 from 2015-16. The income limit for personal allowance remains at £100,000.
The marriage allowance has increased £40 from £1,060 to £1,100. There have been other allowances such as a dividend allowance and personal savings allowance introduced for the 2016-17 tax year.

National Insurance Contribution Thresholds

There are no changes to the weekly lower earnings limit (LEL), weekly primary threshold or the weekly secondary threshold. The upper earnings limit (UEL) has increased from £815 in 2015-16 to £827 in 2016-17. There are no changes to the Class 1 National Insurance contribution rates for 2016-17.

The Employment allowance has increased by £1,000 to £3,000 for 2016-17 per employer for the tax year.

The details in full are available to view on the HMRC website with the following link:
https://www.gov.uk/government/publications/tax-and-tax-credit-rates-and-thresholds-for-2016-17/tax-and-tax-credit-rates-and-thresholds-for-2016-17

Posted byDebbie ClarkeinPayroll Software

Single Director Companies excluded from Employment Allowance claim from 6th April 2016

Single-director companies will not be eligible to claim the National Insurance Contributions Employment Allowance for the new tax year 2016-17. The employment allowance for the new tax year 2016-17 will be £3,000, an increase from £2,000 from 2015-16.

A Technical Consultation on Companies Excluded from the NICs Employment Allowance has been published to seek comment on the draft secondary legislation to implement the new exclusion. The consultation will run until 3rd January 2016.

The main reason for this change is to make the Employment Allowance more focused on businesses that are creating and sustaining employment and as a result where a director is the sole employee of a limited company this company is excluded from availing of the Employment Allowance. These regulations will apply in England, Wales, Scotland, and Northern Ireland.

Posted byDebbie ClarkeinPayroll Software

Rise in auto-enrolment compliance notices issued by TPR

Figures from The Pensions Regulator (TPR) show 469 auto-enrolment compliance notices were issued to employers between July and September 2015.

A compliance notice is issued under section 35 of the Pensions Act 2008 to remedy a contravention of one or more auto-enrolment employer duty provision

The latest number is almost quadruple that for the previous quarter. In addition, during the last quarter TPR issued 85 unpaid contributions notices, 107 fixed penalty notices of £400, and two escalating penalty notices carrying a daily fine of between £50 and £10,000 – bringing the total of escalating penalty notices issued to seven.

Full article www.payrollworld.com

Posted byCaoimhe ByrneinAuto Enrolment

Student Loan Deductions 2016/17

Currently there are two types of Income Contingent Student Loans however, only one is repaid via deduction through payroll. Income Contingent Loans pre-September 2012 are known as Plan 1 loans and are currently operated through payroll. Loans taken out post-September 2012 are known as Plan 2 loans and are currently repaid outside of the payroll directly to the Student Loans Company.

From 6 April 2016 Plan 2 loans will also be calculated and repaid via deduction from payroll. Employees repaying under the existing threshold will not be affected by the change.

Thresholds:

Plan 1 Loans - £17,495 per annum
Plan 2 Loans - £21,000 per annum

Key employer facts:

• Employers will never be asked to operate more than one plan type at a time for an employee
• The main employer notice will continue to be the SL1 start notice, every SL1 issued will indicate which plan type should be operated
• From the 6th April 2016, the starter declaration checklist will prompt employers to ask new employees about their student loan plan type
• The P45 will not be amended, it will continue to indicate if employees were repaying a student loan in their previous employment but it will not specify if it was a Plan 1 or Plan 2 loan
• If new employees cannot say which Plan type they have, the default for employers is Plan 1
• If this is incorrect, HMRC will be sending a SL1 anyway once the new employee information is sent on the first FPS
• If applicable, the Plan type can be amended within the payroll software

Further information can be found in HMRC’s August 2015 Employer Bulletin
https://www.gov.uk/government/publications/employer-bulletin-august-2015

Posted byAudrey MooneyinPayroll Software

Chancellor announces extension of shared parental leave and pay to working grandparents

Chancellor George Osborne has announced that he will extend shared parental leave and pay to working grandparents, in recognition of the crucial role that working grandparents play in providing childcare for their families.

Approximately seven million grandparents are said to be involved in childcare, with evidence suggesting that nearly 2 million grandparents have given up work, reduced their hours or have taken time off work to help their families who cannot afford childcare costs. More than half of mothers rely on grandparents for childcare when they first go back to work after maternity leave, and over 60 per cent of working grandparents with grandchildren aged under 16 provide some childcare.

Consultation on the new measure will begin in the first half of 2017, with the aim of implementing the policy by 2018. The extension of shared parental leave and pay to working grandparents will ensure that hardworking families can structure their lives in a way that will work best for them and will provide flexible working arrangements for grandparents without the fear of losing their job.

Posted byVictoria ClarkeinParental LeavePayroll Software

NMW Reminder - new rates apply from 1st October 2015

The new rates are dependent on age and are as follows:

Workers aged 21 and over: £6.70 an hour
Development rate for workers aged 18-20: £5.30 an hour
Young workers rate for workers aged 16-17: £3.87 an hour
Apprentices under 19, or over 19 and in first year of the apprenticeship: £3.30 an hour

In addition to the above, from April 2016, the government will introduce a new mandatory National Living Wage (NLW) for workers aged 25 and above, initially set at £7.20 – a rise of 70p relative to the current National Minimum Wage (NMW) rate, and 50p above the increase coming into force on 1st October.

The National Minimum Wage will continue to apply from April 2016 for those aged 21 to 24.

Posted byAnn TigheinPayroll Software

HMRC are setting up a compliance team to target those employers who are not in compliance with the National Minimum Wage.

It is part of a series of measures announced by Business Secretary Sajid Javid to ensure employers pay the legal minimum rate and further backed up by David Cameron who announced stringent penalties for non compliant employers. These include doubling penalties for non-payment of the NMW, increasing the enforcement budget, and disqualifying those found guilty from being a company director for 15 years.

“This one-nation government is committed to making work pay and making sure hardworking people get the salary they are entitled to,” added Javid.

From next April, firms will have to pay all workers aged over 25 at least £7.20 an hour - compared to £6.50 now. The minimum wage will be increased to £9 by 2020 with Britain having one of the most generous pay guarantees in the world.

“There is no excuse for employers flouting minimum wage rules,” said Javid. “These announcements will ensure those who do try to cheat staff out of pay will feel the full force of the law.”

The new compliance team will investigate the most serious cases of employers failing to pay NMW, including the national living wage, which will be introduced from April 2016. It will have power to issue penalties, pursue prosecutions, and name and shame the most exploitative businesses.

Although the maximum penalty of £20,000 a worker remains, the calculation of penalties on those who fail to comply will increase from 100 per cent of arrears to 200 per cent. However, this will be halved if payment is made within 14 days. This reform is intended to increase compliance and ensure tough consequences for those who break the law.

The government also announced that it will work with payroll providers to ensure their software can check that staff is paid what they are entitled to. It will also improve guidance and support.

Posted byAnn TigheinContract of employment

Young adults planning early for retirement

The launch of automatic enrolment into workplace pensions in 2012 is being hailed as helping to develop a greater pension savings culture across the UK.

A new study carried out by charity The National Skills Academy for Financial Services (NSAFS) and AXA Investment Managers, has found that today’s young adults in the UK are likely to start thinking about their retirement plans at the age of 27, compared to their parent’s generation who on average did not start thinking about life after work until the age of 41.

Similarly, research conducted by NEST in 2014 also found that people aged under 30 were embracing automatic enrolment more than any other age group, with just one in every 20 workers aged between 22 and 29 choosing to opt out of their workplace pension scheme.

Stephanie Condra, market strategist at AXA Investment Managers, said: “It’s never too early or too late to get ready for retirement.”

Approximately five million people have so far been placed in a workplace pension, and there are around another five million still to be placed in a scheme as auto-enrolment continues to be rolled out across employers.

Posted byVictoria ClarkeinAuto Enrolment