Aug 2014
7
Have you claimed your £2000 Employment Allowance?
An estimated 1.25 million employers are eligible for the £2,000 Class 1 NI rebate, which came into force in April this year, yet around 1 in 10 small businesses are not claiming the annual £2,000 Employment Allowance.
The process of claiming the allowance in BrightPay is very straightforward. View our online support or call us if you want to find out how to claim.
Aug 2014
6
Call for RTI relaxations for small employers
The Chartered Institute of Taxation (CIOT) has made this submission to review the competitiveness of tax administration in the UK being conducted by the Office of Tax Simplification (OTS).
The CIOT says that their clients find that the reporting of realtime information as being, “too prescriptive, time consuming and even unworkable at times”. They are looking for a permanent concession to allow small employers to report monthly , rather than at the time of each payment of salary or wages.
Aug 2014
1
Thesaurus Software enters corporate partnership agreement with The Start Up Loans Company
Thesaurus Software is delighted to announce that it has entered into a corporate partnership with The Start Up Loans Company.
Through this exclusive arrangement, Start up Loans' clients will be offered free payroll software and support.
The Start Up Loans Company is a UK government funded initiative aimed to help new businesses by offering loans at attractive rates for the purpose of start up funding. Start Up Loans also helps with discounted and/or free products, services and mentoring which the start ups require to get up and running. This is where Thesaurus Software comes in with its free offering of BrightPay payroll software.
The Start Up Loans Company has funded and guided over 19,000 new businesses since its inception two years ago. Approximately 40 new businesses are started a day through the scheme.
Jul 2014
28
Failure to complete end of year declaration 13/14
HMRC have now provided a statement about the small number of employers who did not complete the end of year questions and declaration when submitting their final FPS or EPS for 13/14.
HMRC expects all employers to comply with their legal obligations. Where the final indicator has not been completed but all other obligations are met , HMRC will automatically process the return and calculate the final liability (if any). Employers who fail to complete the end of year questions & declaration will miss an opportunity to demonstrate their low risk status in every respect. This failure will feed into the compliance risk assessment processes.
At the moment HMRC do not have an plans to contact employers who fail to complete the final submission indicator. HMRC are continuing to educate employers to make sure that all of their RTI submissions are full and complete and that they meet their legal obligations. They have said they will monitor the situation and consider whether any further action is required.
Jul 2014
15
Class 1A NIC payment for 13/14 deadline 22nd July
Employers should make sure they pay 2013/14 Class 1A National Insurance contributions (NICs) by the deadline of 22 July for electronic payments or 19 July for cheques. If they do not they may get a late payment penalty. Employers should check they have the right reference number to help the payment go straight through.
Ways to pay PAYE/NICs
HMRC strongly recommends that you use an electronic payment method.
Paying electronically is fast, secure and convenient provided you use an accurate reference number - and it's mandatory for employers with 250 or more employees.
It's your responsibility to make sure payments are made on time, whichever payment method you use. You may be charged interest and a penalty if your payment isn't received by the deadline.
HMRC counts all of the payment methods listed below as electronic:
• Direct Debit
• Online debit or credit card using BillPay
• Bacs Direct Credit
• Faster Payments by online or telephone banking
• CHAPS
• GBS Transfer
• Bank Giro
• payment at the Post Office
You can find out more about these and other payment methods by reading the guide 'How to pay PAYE/Class 1 National Insurance/CIS'.
Jul 2014
10
When will HMRC Raise a Filing Penalty?
Penalties will apply:
Where a Full Payment Submission (FPS) has not been filed on or before the date you paid your employees, or where you have not revealed why submission is legitimately late by using the late reporting reason field.
Where the expected numbers of submissions have not been received.
These rules apply to each PAYE scheme, rather than each employer.
How do I avoid incurring a late filing penalty?
Using HMRC's Online Service - PAYE for employers
You must submit an FPS each time you make a payment to an employee, on or before the date that you pay them.
If you don’t need to send an FPS because you did not pay any employees in a tax month, it is important that you inform HMRC by sending a nil Employer Payment Summary (EPS) by the 19th of the following tax month. Otherwise, it is likely that it will be assumed that you have missed a submission and will therefore issue a late filing penalty, which you will have to appeal.
To help get your PAYE up-to-date and avoid future penalties, you should take note of any late and non-filing electronic Generic Notification Service (GNS) warning messages which we send to help you get your PAYE affairs up to date – see the Using HMRC's Online Service - PAYE for employers for more information.
Jun 2014
17
PAYE for employers: telling HMRC that your business has ceased
Employers who no longer need their PAYE scheme can avoid non-filing Generic Notification Service (GNS) messages and penalties by ensuring that they make their final submission correctly.
The actions for employers to take will depend on what type of final submission they are sending, and for what tax year:
2014 to 2015
• Full Payment Submission (FPS) - when making their final FPS for 2014 to 2015 employers should:
- run their final payroll
- complete the 'Final submission because scheme ceased' and 'date scheme ceased' boxes on their FPS for the pay period
- enter a leaving date on each employee's payroll record
• Employer Payment Summary (EPS) - if they have already sent all their payroll information, employers should just complete the 'Final submission because scheme ceased' and 'date scheme ceased' boxes on the EPS.
This will ensure that HMRC's systems are updated to record the PAYE scheme as ceased.
There's more information, and details of the other actions that employers should take when their business ceases, in the PAYE if your business closes or changes guidance.
2013 to 2014 (PAYE reported in real time)
Employers who have already received an interim penalty warning letter, but who:
- stopped paying people in 2013 to 2014; and
- have already submitted all of their payroll information
should follow the EPS actions in 1b above to stop a penalty.
However, if there is PAYE information still outstanding they should also send an Earlier Year Update (EYU) to make a final submission for the year.
Employers should send their final 2013 to 2014 submission as soon as possible to limit any penalty that is due. For full guidance read:
PAYE final submission for the year and end-of-year tasks
Bright Contracts – Employment Contracts and Handbooks.
BrightPay – Payroll & Auto Enrolment Software.
Jun 2014
9
Thousands of underpaid workers benefit from HMRC NMW investigation 6 June 2014
More than 22,000 workers denied the National Minimum Wage (NMW) have received £4.6m in unpaid wages following an HMRC crackdown.
HMRC conducted 1,455 NMW investigations in 2013/14 and found arrears in 47% of cases – the highest strike rate since NMW was introduced.
During the period, HMRC issued 652 financial penalties worth £815,269 and recovered average arrears of around £205 per worker.
Jennie Granger, director of enforcement and compliance at HMRC, said: “Paying the National Minimum Wage is not a choice – it’s the law. HMRC will continue to ensure that workers get at least the wage to which they are legally entitled.
“Where an employer ignores these rules, we will ensure that any arrears are paid out in full and the employer is fined. Rogue employers be warned – we will find you and you will pay.”
In one case a social care provider had not paid its staff for travelling time and other hours worked and was told to repay over £600,000 to almost 3,000 workers.
And a recruitment agency was ordered to pay £167,000 to workers, including some it had classified as unpaid interns.
As a result of the investigations, TUC general secretary Frances O’Grady is calling for further action to be taken by the government and for employers that knowingly underpay their staff to be named and shamed.
“Nearly a million UK workers rely on the national minimum wage, which has become a vital lifeline. There must be no hiding places for companies who flout it.
“The action taken by HMRC is a welcome step but must be the beginning of a concerted campaign that also raises awareness about the right to a legal wage among those being exploited.”
Bright Contracts – Employment contracts and handbooks.
BrightPay – Payroll & Auto Enrolment Software.
Jun 2014
4
Changes to Holiday Pay Calculations
As we enter the summer holiday season employers need to ensure that they are paying their employees correctly during annual leave.
A recent decision by the European Court of Justice (ECJ) will impact how some annual leave pay is calculated.
Do you pay employee’s commission? Is the commission calculated based on the amount of sales made or actual work carried out? If yes, according to the ECJ, holiday pay should include commission pay.
The decision was made in the case of Locke v British Gas Trading and Others. Locke was a Sales Representative whose commission made up approximately 60% of his remuneration. After taking two weeks leave in 2011, Locke suffered financially as he was unable to generate sales for the period he was on annual leave.
The ECJ ruled that the purpose of annual leave is to allow a worker to enjoy a period of rest and relaxation with sufficient pay. By not including commission payments with holiday pay, employees are less likely to take annual leave so as to avoid financial hardship.
It has been left to the national courts to determine how to calculate the commission to which a worker is entitled, however the court did suggest that taking an average amount of commission earned over a certain period, e.g. the previous 12 months.
Employers are advised to review their commission policies to establish which, if any, payments need to be included in annual leave pay.
May 2014
30
HMRC Dashboard
HMRC have improved their Business Tax Dashboard following feedback from their customers and have attempted to make it more user friendly.
There have been improvements made to the “Current Position” and the help icons.
Employers will be able to check how the amount they owe is calculated and when the HMRC updates the “Amount Due” on the screen.
It will show the payment date and how the payments are allocated.
Information is also given on the Employment Allowance.
