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ISSUE 6
I’m Dreaming of an Alright Christmas
By Simon Parsons
One of the significant differences between the United Kingdom and many other nations is that the traditional New Year’s Day for tax retains the original Julian calendar alignment with what was 25th March. Through alignments in 1752 with the Gregorian calendar along with the movement of the celebrated New Year’s Day to 1st January, and some movements of leap year differences in 1800, have resulted in the present UK tax year start of 6th April annually for tax law.
Gifts An employer may provide
Fortunately, this means that for UK payroll professionals, Christmas is not also impacted by a 1st January new tax year. However, there are other implications for payroll professionals to consider during this and other festive seasons. Bonus Some employers still make cash additions to their employees for Christmas, these count as employment income and are added to the normal employee
employees with a seasonal gift, such as a turkey, an ordinary bottle of wine or a box of chocolates at Christmas. All of these gifts can be treated as trivial benefits. For an employer with many employees, the total cost of providing a gift to each employee may be considerable, but where the gift to each employee is a trivial benefit, this principle applies regardless of the total cost to the employer and the number of employees concerned. If a benefit is trivial, it should not be included in a PAYE Settlement Agreement.
earnings for tax and Class 1 National Insurance purposes using standard payroll processing cycles.
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