MEMBERSHIP INSIGHT
employer NICs have been paid at any part of the tax year then class 1A will be due, possibly on a pro rata basis. Q: An employee has been on long- term sick leave. She is going on maternity leave shortly but unfortunately is not entitled to statutory maternity pay (SMP). She has now reached the point where it is four weeks before her expected due date. A: If the employee is not off sick with a pregnancy-related illness then statutory sick pay (SSP) can continue up to the day before her maternity leave date which she has requested. If this employee has been off sick with a pregnancy-related illness and this continues into the four weeks before the due date, then SML and SMP would automatically commence at this point. As she is not entitled to SMP in this scenario she could potentially be entitled to maternity allowance which she could claim from the Jobcentreplus. Please see paragraph 4.8 on the following link for further guidance https://goo.gl/hp6YAH. Q: I have a dilemma over an employee who on their second day of employment was in a car accident which has resulted in them not being able to attend work for the last two weeks. They have provided a doctor’s note for the two weeks they have been absent but have not been paid yet and earned over the £113 a week threshold. Are we able to process SSP for them? A: The guidelines for SSP eligibility are that your employee must have completed some work for you; therefore, in the scenario outlined, it appears they could possibly be eligible for SSP depending on the earnings. You would have to base the earnings test on what they would have earned if they had been at work for the payment period not for the hours they worked. If they pass the earnings test the employee would then be eligible for SSP. Q: We have a new employee who joined our company on 16 November and is also going on maternity leave on 13 December. Unfortunately, she has not been employed by us long enough to be entitled to SMP, and so I have issued When will she have to start her statutory maternity leave (SML)?
Advisory Service is available 9a.m. to 5p.m. Mondays to Thursdays, and 9a.m.
to 4.30p.m. on Fridays. It is free to all CIPP members * , students and attendees of approved CIPP courses and conferences in the last six months. Call 0121 712 1099 , email advisory.service@cipp.org.uk or visit cipp.org.uk for frequently asked questions.
Advisory
*please see summary at cippmembership.org.uk for details.
Q: Is there a limit on the number of earlier year update (EYU) returns that can be submitted to HM Revenue & Customs (HMRC)? A: I can confirm that HMRC do not limit the number of EYU submissions which can be submitted by employers. It may be that your provider has agreed limits within their terms of engagements, so you would need to go back to these terms to check what is included. Insurance contributions (NICs) via the post office and whether this would also affect pay as you earn (PAYE) income tax and class 1 NICs? A: The last day an employer can pay class 1A NICs, PAYE income tax or class 1 NICs to HMRC via the post office was 14 December 2017. From 15 December 2017, you need to have an alternative method in place. Employers can choose to pay HMRC by one of the four methods: online, telephone banking, CHAPS and BACS. Credit cards can be used but will incur a fee, and from 13 January you will not be able to use a personal credit card. Confirmation of these changes can be found at the following link https://goo. gl/541XH7. Q: An employee has now reached state pension age (SPA) and so we have changed the table letter for NICs to category C. Will this employee still have to pay their student loan? Q: Will HMRC no longer accept payments of class 1A National
A: It is correct that if the employee has reached SPA then you should amend their NICs category accordingly, but this will have no reflection on the student loan deduction. This should still be taken providing they have hit the correct earnings levels associated with student loan deductions. This link to GOV.UK website provides information: https://goo.gl/J6BwWs. Q: We have several seconded employees from Germany who have current A1 documents and are exempt from employer and employee NICs. My question is whether their benefits in kind (BiK) that are being reported in P11D returns would also be exempt from class 1A NICs? A: As there are current A1 documents in place for these employees, there are no employee or employer NICs due. Following this, I can confirm that there will also be no class 1A NICs due on the BiKs reportable in the P11D for these employees. Please see the following links: https://goo.gl/E1Vuyc, https://goo.gl/ xYH8M3. HMRC’s guidance states that there will be no class 1A NIC liabilities on BiK if all of the following apply: ● the benefit must be chargeable to income tax on an amount of general earnings as defined at section 7(3) of the Income Tax (Earnings and Pensions) Act 2003 (even though tax may not actually be paid) ● there must be liability for employer class 1 NICs for any part of the tax year in which the benefit was provided, so if
| Professional in Payroll, Pensions and Reward | February 2018 | Issue 37 6
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