Professional October 2021

PROFESSI NAL in Payroll, Pensions & Reward Issue 74 October 2021 Official publication of The Chartered Institute of Payroll Professionals

Career paths and opportunities for payroll professionals

National Payroll Week 2021 Time to celebrate

Payroll professionals… tax advisers? Do payroll teams provide tax advice?

Market insight report You spoke, we listened

CIPP UPDATE POLICY HUB PERSONAL DEVELOPMENT

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Editor’s comment I can’t quite believe I’m writing this, but October’s issue of Professional marks my first as editor. To say this is my dream job is a complete understatement, and, although this has been a steep learning curve,

I was working as a payroll administrator, I never envisaged that I would become editor of the CIPP’s flagship magazine. There are many interesting articles within this issue exploring topics such as pay on demand, the future of employment status and recent employment law cases. We couldn’t let October slip by without mention of Halloween, so some payroll horror stories have also crept in. We recommend that you don’t read these with your light off!

I have found the whole process very rewarding. Mike Nicholas edited the magazine since 2008, and I would like to take this opportunity to thank Mike for all his hard work in making the magazine a huge success, and for the training and mentoring he has given to me. I wish him a very happy retirement. Coincidentally, the theme of this issue focuses on career paths and opportunities for payroll professionals. My payroll journey pays testament to just how varied a payroll career can be. Back when

Lora Murphy ACIPP (editor@cipp.org.uk) Editor

Chair’s message

Payroll professionals must be highly numerate, pay attention to detail and have good computer skills at the start of their careers. From there, the world is their oyster in terms of career opportunities.

have gained a payroll qualification and they will explain how it has benefitted them. Working in payroll brings exposure to diverse subjects: a deep financial awareness, appreciation of the financial commitments people face and understanding the consequences of making mistakes for individuals they pay. The knowledge a payroll professional builds is invaluable in everyday life. A much-discussed subject is where payroll fits within organisations. Even though we know payroll should be a function in its own right, it generally sits in either human resources or finance. Whichever route or role, keeping abreast of developments in the world of payroll is essential. Opportunities will present themselves which you will want to be ready to grasp.

As a tutor, I always ask new students if they chose payroll as a career. Twenty years ago, it was rare to find one student who had, whereas recently, some even confirm they self-fund their studies as they want to embark on a payroll career. Those who work in payroll would never describe it as dull. We experience constant changes - some small, some big, but all of which the conscientious payroll professional will embrace to ensure employees are paid accurately and on time. My own career path, although diverse, has not encompassed the multitude of opportunities available. Starting as a payroll apprentice moving through the ranks to become payroll director is just one route. Gaining payroll qualifications along the way enhances career prospects, opening many doors. Speak to fellow professionals who

Liz Lay MSc FCIPPdip FHEA ACIPD (liz.lay@cipp.org.uk) Chair, CIPP

CEO’s message

Well, my message is almost the same as it was this time last year, as summer is over and many of us have not had the holidays we envisaged or visited our country of choice. I do hope you and your families and

the need for well-educated payroll professionals, and it was great we could collaborate and celebrate NPW. We are excited for the highlight of the year – the Annual Conference and Annual Excellence Awards – on 6 and 7 October 2021. We have implemented the right platform and technology so that it can be delivered online. Expect a high-calibre agenda, with professional speakers and excellent workshops and discussions, designed to ensure your continuous professional development. At the time of writing, the intention is to hold our Graduation Ceremony on 5 November 2021 for those who have successfully completed our university-approved qualifications. We will hold two Graduation Ceremonies for the classes of 2020 and 2021. Let’s hope the world looks a safer place this time next year for meeting colleagues face to face for all our events.

colleagues remain well and have managed a break or ‘staycation’. Once again, the CIPP team is preparing for a busy autumn of CIPP virtual events but is saddened that the normal in-person visit to Celtic Manor for the Annual Conference and Excellence Awards Ceremony won’t go ahead. Fingers crossed this will be a face-to- face celebration on 5 and 6 October 2022 – put it in your diary! We celebrated the 23rd anniversary of National Payroll Week (NPW), mixing online and in-person events in the week commencing 6 September 2021, supported by our Chair, Liz Lay. I’m delighted that we met Chartered and fellow CIPP members as well as many distinguished guests. It was a pleasure to celebrate the payroll profession, alongside other organisations, who played an active part in promoting and educating payroll professionals. They included the Global Payroll Association, Reward Strategy and the Payroll Centre. We recognise

Ken Pullar FCIPP (ken.pullar@cipp.org.uk) Chief executive officer, CIPP

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| Professional in Payroll, Pensions and Reward |

Issue 74 | October 2021

in Payroll, Pensions & Reward PROFESSI NAL

Also available online at professionalmag.co.uk

Contents

October 2021

THIS ISSUE’S FEATURE TOPIC CAREER PATHS ANDOPPORTUNITIES FOR PAYROLL PROFESSIONALS

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Career paths and opportunities for payroll professionals

by Jerome Smail

Features

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Our shop window to the world by Gordon Cresswell

Market insight survey by Joanne Hudson

BeKnowledgeable series by the CIPP policy and research team

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The interaction between the gig economy and employment status by Lora Murphy

Construction industry scheme – ongoing compliance issues by John Harling

Preparing for a payroll audit by Gretchen Inouye

| Professional in Payroll, Pensions and Reward | October 2021 | Issue 74 2

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Editor Lora Murphy 0121 712 1018 | lora.murphy@cipp.org.uk Advertising Daniel Cull 0121 712 1021 | advertising@cipp.org.uk Design James Bartlett and Nicole Davis design@cipp.org.uk Printing Warwick Printing Company Ltd

To advise or not to advise by the CIPP policy and research team

Tales from the crypt – payroll horror stories

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Chief executive officer Ken Pullar FCIPP CIPP board of directors Jason Davenport MCIPP MIoD Louise Gray ChMCIPPdip

Stuart Hall MCIPPdip Helen Higson ACIPP Dianne Hoodless MSc ChFCIPP FHEA Liz Lay MSc FCIPPdip FHEA ACIPD Jeremy Montgomery BA(Hons) FCIPP

When I grow up, I want to work in payroll by Julie Dansie

Are pensions coming back in to fashion? by Henry Tapper

Carole Pearson MCIPP Katie Sharpe MCIPPdip

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Cliff Vidgeon BA(Hons) CMA ACG ChFCIPP Clare Warrington MSc FCIPPdip AFHEA

Useful contacts

Employment law round-up: strikes, childcare, agency workers and furlough by Nicola Mullineux

Education education@cipp.org.uk 0121 712 1023 Events events@cipp.org.uk 0121 712 1013 General enquiries enquiries@cipp.org.uk 0121 712 1000 Marketing and sales marketing@cipp.org.uk 0121 712 1033 Membership membership@cipp.org.uk 0121 712 1073 Training training@cipp.org.uk

Making hybrid working work by Danny Done

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CIPP’s benchmarking survey gets a revamp by Gemma Mullis

Is this the end of the monthly pay day? by Samantha Johnson

Regulars

0121 712 1013 cipp.org.uk @CIPP_UK

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30 Reward 39 Technology

Editor’s comment, and Chair’s andCEO’smessage

05 Personal development BePayroll, Diary of a student 07 My CIPP Spotlight on, CIPP update, On your behalf, Advisory 14 National PayrollWeek

Articles Please support this magazine so that it can continue to be a part of your membership package. Trademarks The CIPP logo, the initials ‘CIPP’ and the words ‘Professional in Payroll, Pensions and Reward’ and ‘CIPP Consult’ are trademarks of the Chartered Institute of Payroll Professionals. Copyright: The Chartered Institute of Payroll Professionals 2021. The Chartered Institute of Payroll Professionals, Goldfinger House, 245 Cranmore Boulevard, Shirley, Solihull, West Midlands, B90 4ZL. Switchboard 0121 712 1000 Copyright This magazine is published by The Chartered Institute of Payroll Professionals in whom the copyright is vested. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or any means, electronic, mechanical, photocopying, recording or otherwise, without the prior written permission of the publisher. The views expressed in this publication are not necessarily those of the CIPP or the editor. The information and comment contained in this publication are given in good faith, their accuracy or completeness cannot be guaranteed.

40 Industry news 46 Wordsearch 48 Confessions of a payroll manager

20 Payroll news 21 Compliance

Full issue including additional online content available at professionalmag.co.uk

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| Professional in Payroll, Pensions and Reward |

Issue 74 | October 2021

Gordon Cresswell FCIPP, ex CIPP boardmember, acknowledgesMike Nicholas as he retires, and his contribution to themagazine

T he intangibility of the payroll displays the fruits of our labour and, of course, it’s the most anticipated communication of the month for most employees. That’s our raisin d’etre . It is the payroll service’s window to the world. The same principle applies to the CIPP and our magazine, Professional . It is unvaryingly well received, always on time, precise and beautifully turned out. In fact, along with our Advisory Service, it forms the jewels of our CIPP crown. service requires punctual, accurate, presentable pay advice which From very humble beginnings in the early eighties when it was produced by Chris Williams as a very basic but informative newsletter (we had no money

in the early days, just volunteers) our magazine has developed, over the years, to the wonderful product we have today. Although many people contribute to its success, there is no doubt in my mind that the standard we enjoy today is in large part due to our retiring editor, Mike Nicholas. I have known Mike from the very early days when we set up the British Payroll Managers’ Association, now the CIPP. In those early days, Mike was cutting his teeth on the magazine for the Payroll Alliance and, he would admit, I’m sure, he was a member of our association so he could keep an eye on our development. Always supportive, but critical, when he saw how matters could be improved, I was delighted when he joined the team as editor. The magazine took an immediate leap forward in quality and content, largely because, as an ex-payroll professional, he understood the issues and had experienced the angst all of us have endured in our payroll careers. This enabled him to write with empathy, understanding and expertise. I believe he reads anything and everything to do with payroll and, more

services, that does for payroll what Harrods has done for retail. On behalf of the whole of the CIPP, I acknowledge the incredible contribution you have made, Mike, and thank you for a job well done. We are sad to see you leave and we know you will be keeping a watchful eye on the magazine’s development. We will still be requesting the occasional contribution! So, as Lora Murphy takes on the role of editor, we all wish her well and she can be assured of the valuable support of the production team under James Bartlett, the advice and mentoring of business development director, Vickie Graham, and, of course, from me, and certainly from my old friend, Mike Nicholas. And finally, Mike quoted Oscar Hammerstein in his leaving editorial: “So long, farewell, auf wierdersehen, adieu”, so by way of response I offer Robert Southey (Poet Laureate 1813-1843): “No distance of place or lapse of time can lessen the friendship of those who are thoroughly persuaded of each other’s worth.” o

recently, he has developed an expert eye for pensions and reward issues. We have all seen

the splendid results of Mike’s high standard of editorship and the production of many of his own beautifully written articles – a shop window to the CIPP’s

| Professional in Payroll, Pensions and Reward | October 2021 | Issue 74 4

Personal development

# Be Payroll

Vanessa Hamilton, client services director at Payescape , explains how the Payroll Technician Certificate has enhanced her career

What course have you studied/are you currently studying? To support my career in the payroll industry, I studied and gained the CIPP Level 3 Payroll Technician Certificate, which helped me develop my core skills in payroll processing. It covered a wide range of topics, including how to calculate gross pay, statutory payments, tax and national insurance deductions and pension contributions. The course developed and consolidated my payroll knowledge, giving me the confidence to progress my career. How would you describe your experience of studying with the CIPP? I chose to complete an intense course which involved obtaining the qualification in three months as opposed to six. The support from the CIPP during this time was extremely professional and supportive. My tutor travelled from the mainland UK to Northern Ireland to teach the course. She was very thorough in her teaching and extremely helpful. She was knowledgeable and made the learning process fun. The CIPP membership, which followed completion of the course, was invaluable as it gave me access to qualified advisors to answer complex payroll queries. The Advisory Service were only ever a phone call away. This was a great benefit and further supported my development as I was able to learn from them and gain experience. Why was it important to you that you gained this qualification? Although I have worked in payroll for over ten years, I didn’t have a recognised qualification to support my experience. I felt that the CIPP, as a well-known and credible organisation within the payroll industry, would be instrumental in growing my career to management level. It is all too easy to become reliant on software, and I felt it was important to learn how to perform calculations manually and gain the skills to underpin my existing knowledge. In practice, this boosted my confidence with client queries, as I was able to explain and break down calculations in simple terms. Can you describe your payroll career/journey to us so far? I come from a finance background, primarily in accounts. As my previous employer invested in several other businesses, I found myself taking on the task of processing payroll for approximately 250 staff. Truth be told, this is not where I had envisaged my career. However, I really enjoyed it and proceeded to take up a post at Payescape as a payroll administrator. Payescape is a busy payroll bureau, processing payroll for thousands of clients. It is a fast-paced environment, so I knew the CIPP course would be beneficial. After completing the course,

I quickly progressed to team leader and then to operations manager. I am pleased to say that I was recently promoted to director of client services. This role involves ensuring client satisfaction and maintaining a 98% client retention rate. Whilst I am moving into a different area in the business, being up to date with ever-evolving payroll legislation is crucial and CIPP membership allows me to do this. Do you have any plans for further study with us? If so, what are they and why? I am currently studying the Chartered Institute of Personnel and Development (CIPD) level 5 diploma in human resources. Once I have completed this, I intend to enrol on the Foundation Degree in Payroll Management with the CIPP. Personal development is important to me and I am always eager to learn and gain further knowledge. This will enable me to pass my expertise on to colleagues and support them in their development journeys which, in turn, will benefit our clients. I am incredibly lucky that the company I work for is continuously investing in its employees. What advice do you have for someone who is thinking of studying a qualification with us? I would not hesitate in recommending the CIPP to others. My studies with the CIPP have been a great investment. I feel immensely proud to have achieved an industry recognised qualification with such a distinguished body. The CIPP has been instrumental in my development, and I feel it would do the same for anyone who is keen to strengthen their knowledge and enhance their skills. How do you feel about working in payroll? What does working in payroll mean to you? For me, payroll is a very worthwhile and rewarding job. It is a fast- paced environment, and I particularly enjoy the sense of satisfaction and achievement at month-end when the pressure is on. We always manage to get everyone paid on time. I feel honoured to say that payrollers were identified as key workers during the pandemic and were a vital cog in the wheels of many businesses. We provided essential information to many who were placed on the Coronavirus Job Retention Scheme. I enjoy being part of a close-knit team where everyone lends a helping hand. Hopefully, I am testament to those who have chosen a career in payroll, as there are plenty of opportunities for growth and development, if that is the path you wish to take. n

If you are interested in being featured in the BePayroll series, please email marketing@cipp.org.uk .

Be Knowledgeable . Be Developed . Be Recognised . Be Supported . Be Connected .

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| Professional in Payroll, Pensions and Reward |

Issue 74 | October 2021

PERSONAL DEVELOPMENT

Diary of a student…

team. It changed my perspective, not only as a payroll professional, but also as a leader. The skills are transferrable and widespread. The reflective work in year three taught me a lot about myself, both as a learner and a leader. The work is hard and time-consuming, but the skills and knowledge you gain from it are invaluable. Don’t skip reading the study material. It holds valuable information that helps, not only to pass your module, but it also makes everyday payroll more understandable. Howdid youmanage thework- life balance and your study? Do you have any tips for others in the same position? Keep a diary and allocate yourself time for studies. Work-life balance is hard enough without the added pressure of studying. But keeping myself to a schedule really helped me. You get out what you put in, so invest your time wisely. What would you say is themost important thing you learnt? I learnt a lot about myself and my capabilities in year three. I had been dreading the work-based project since year one, but upon completing it, the experience taught me that I can do it if I put my mind to it. What did you gain from this qualification – both in terms of skills and career progression? The qualification improved my soft skills as a leader and a team player. It helped me to reflect on my abilities and career aspirations. It also taught me a lot about how to manage change and project management, which has proved extremely useful. In terms of career progression, the qualification has seen me transfer into more senior roles and helped me to achieve my dream of working in the CIPP’s materials department. n

Lauren HandleyMCIPP Subject matter expert, CIPP

Tell us a little about your background and life, so far? I am a law graduate from Aberystwyth University, currently working in the materials department for the CIPP. My role involves writing and updating technical material used for the CIPP’s extensive educational catalogue. I am relatively new to this role, having transferred from the advisory team in May 2021. What can you tell us about your career and qualifications? I originally aspired to be a corporate law solicitor when I left my studies in 2012. However, I began my career in payroll in the National Health Service (NHS) expenses department, to fund my postgraduate legal practice course and qualify as a solicitor. I was soon placed on secondment within the payroll department under a training scheme and fell in love with the profession. I left my postgraduate studies to instead pursue a career in payroll. I transferred to the private sector in 2017, working for a large public outsourcing company as a payroll subject matter expert. Within six months of working for the company, I was promoted to the payroll operations team lead and was enrolled onto the Foundation Degree in Payroll Management with the CIPP. In July 2020, I was contacted about a vacancy in the CIPP’s advisory team and jumped at the chance to be part of the Institute. The role was a huge learning curve and an invaluable experience. I transferred

into the materials team in May 2021 and am now part of the team responsible for writing training and qualifications material. Why did you choose to study the Foundation Degree? Ever since I started working in payroll, everyone talked about the CIPP and how the Foundation Degree was the qualification to have. I knew that, if I was to develop my passion for the profession along with my payroll knowledge, this was the course that I needed to embark on. I wanted to develop and challenge myself to go as far as I possibly could; and I knew the Foundation Degree would assist in achieving that goal. Howdid you find the qualification? I thoroughly enjoyed studying for the Foundation Degree. There were times when it was a struggle to balance life, full-time work and studies, but being able to allocate designated time to studying helped. I learnt so much during my three years. The tutors were always so helpful and knowledgeable. The study material was a great reference point when I was working in payroll operations, especially during my time as a team leader. What advicewould you give to others who are thinking about studying to improve their career? Don’t hesitate – go for it. It’s been a really rewarding experience, and the assignments teach some great skills and encompass theories on leading and working within a

| Professional in Payroll, Pensions and Reward | October 2021 | Issue 74 6

MYCIPP

Spotlight on...

Did you study a specific course to help you enter this career? When I joined the CIPP, I knew I wanted to have a formal qualification in my chosen career path. I knew that embarking on the Foundation Degree in Payroll Management was the correct choice for me. I began my studies in October 2018 and have recently completed the qualification. Although no specific course is required to work within the industry, I am passionate that education and continuous learning and development are key in being successful. Was there a moment in your life, or career, that made you want to work in payroll? As mentioned, having a background in finance, I already had some exposure to payroll figures. Seeing this information on a regular basis fascinated me somewhat – I would always ask why the PAYE (pay as you earn) figures were different each pay period, and how they were calculated. When the opportunity to work within payroll arose, it was an easy decision for me to take it. How do you feel knowing you have made a positive difference to someone through your advice? My role at the CIPP involves interacting, not just with payroll professionals, but also government bodies. Knowing that my involvement and input has made a difference leaves me with an immense sense of pride. Working within payroll can, at times, be lonely, therefore the knowledge that I can support members

and the wider profession inspires me to continue being a part of the payroll community. What has been your biggest sense of achievement since joining the policy team at the CIPP? Legislation and guidance are ever- changing. The current pandemic and the challenges it presented to payroll professionals have highlighted this. Knowing that the information provided by me and my team was of great importance to the profession gave me a huge feeling of responsibility. Juggling working from home whilst being a mother of two children, and still ensuring that information was delivered to the payroll profession in a timely manner was a big achievement – it will be hard to beat these accomplishments in the future. Tell us about a typical week as a policy/advisory team member I love my role as no day or week is the same. In policy, we must always keep our eyes on everything. You could be happily writing an article and the next minute, a new piece of legislation or an amendment to guidance is issued, and your whole day changes. What type of skills does a policy and advisory member require? To be successful in this role, you must be adaptable to change. Communication skills are also key, along with a keen eye for detail. The most fundamental skill, however, is a passion for payroll. n

GemmaMullisMCIPP CIPP policy and research officer

How did you start your payroll career? I began my career in payroll following a company restructure and although, like others, I ‘fell’ into the role, it was a career choice I actively decided to continue with. I had transitioned from a role in finance, so understanding the figures I used in my previous job in more detail intrigued me, and I was eager to learn more. How did you move into advisory, and then policy? Leaving a role which involved processing payroll to move into an advisory role was initially a struggle. However, my passion for helping and empowering payroll professionals with knowledge made the move easier, as the role allowed me to communicate with them on a daily basis via a variety of platforms. The skills I learned and advanced in the advisory team put me in good stead for my position in the world of policy.

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| Professional in Payroll, Pensions and Reward |

Issue 74 | October 2021

CIPP update

Events NATIONAL PAYROLL Week (NPW) has been and gone in the blink of an eye and was a huge success! We hope you enjoyed the events as much as we did! You can see more NPW content online here: http://ow.ly/frYZ30rTAu7, and relive the highlights in this month’s magazine. A huge thanks to all of you who helped make the week a huge success and, of course, thank you to this year’s sponsors. As our Annual Conference and Exhibition is now here, we look forward to seeing you all at the online events and networking sessions. Again, you can find out more information online, at http://ow.ly/eD8n30rTAfi. Look out for the highlights in the November magazine supplement.

Summer sizzler ON 15 SEPTEMBER 2021, the CIPP hosted an outdoor barbecue, along with games, to raise funds for charity and to thank staff for their hard work over the past year. Multiple burgers and hot dogs were consumed, as the competitive natures of some of the team came out during a Mario Kart tournament. At the time of writing, £307 had been raised for the charities Solihull and Warwickshire Blood Bikes and the Rape and Sexual Violence Project. There was still some delicious cake for sale at this point, which could boost the final figure higher. The CIPP intends to continue putting on events for employees and to raise funds that go towards important causes. Should members enjoy the platform and wish to access its full features, including downloadable resources, they can receive a 20% discount on subscription of the full version. Look in the Membership Offers section of the MyCIPP area of the website. This book also contains the Off-Payroll Tax Handbook , which is a useful guide to the tax and legal implications of the off-payroll working rules. It contains examples, case studies and charts to demonstrate how public and private sector rules apply, and reflects the changes implemented from April 2021. Online access for associate, full, fellow and Chartered members, is available in the membership offers section of the My CIPP area of the website. The second of the new membership opportunities, available across all membership levels, is access to the Croner-i HR-inform Lite platform. Members can now access a wealth of human resources information on one comprehensive online platform, assisting with the management and recruitment of staff. New membership benefits TWO NEW online membership benefits have been added this year, at no extra cost, to support associate members and above with their knowledge and job roles. The first of the new membership benefits is the Payroll Management Book . An essential resource for payroll professionals, the book is packed full of best practice information, relating to topics such as the recruitment and retention of staff, project planning and audits. It also provides guidance on the day-to-day issues that impact payroll departments.

Annual Conference WE ARE looking forward to seeing you all at our virtual Annual Conference and

CIPP’s Annual Conference and Exhibition

Exhibition on 6 and 7 October. Packed with informative sessions, delivered by an excellent selection of industry experts; thought-provoking plenary sessions; numerous networking opportunities and the prestigious award ceremony; the event is a must for all payroll professionals. Watch Eddie ‘The Eagle’ Edwards host one of the plenary sessions, meet other delegates and sponsors, discuss payroll careers and participate in debates. Make your voice heard and be part of the conversation. Book your place today here: http://ow.ly/7orT30rTQya. Graduation ON 5 NOVEMBER 2021, there will be two separate graduation ceremonies for everyone who completed their CIPP Foundation Degrees in 2020 and 2021. The event will be held at Symphony Hall in Birmingham and we will be sending further details out very soon via email. We look forward to celebrating your success. Face-to-face training returns SOME OF the CIPP’s training courses are reverting to face- to-face delivery. If online learning isn’t for you, or you’ve been waiting until face-to-face learning returns, you can now book your place on the following training courses at a location to suit you: ● Payroll update ● Introduction to payroll ● P11Ds expenses and benefits training course collection. You can still take part in these courses online if you prefer. Find out more and book your place here: http:// ow.ly/38fF30rTQvX.

Congratulations to the newly accredited PAS organisations THE CIPP’s Payroll Assurance Scheme (PAS) is designed to test payroll processes in relation to payroll processing and compliance,

● Access Group UK ● BDO LLP ● East Midlands Shared Services

along with people skills and development opportunities. One of the most important elements is ensuring business continuity plans are in place and effective, should they be required. Well done to all organisations that have achieved this and been able to put those plans into action, given the events of the past eighteen months. Special congratulations to our recently accredited organisations:

Ken Pullar, CIPP chief executive officer, said: “Never has it been more important for businesses to have good payroll processes, knowledge and skills that enable them to implement new government legislation and guidance quickly. Congratulations to those organisations that have recently demonstrated just that.” Email compliance@cipp.org.uk for more information on PAS.

| Professional in Payroll, Pensions and Reward | October 2021 | Issue 74 8

O N L I N E L E A R N I N G

Policy hub

On your behalf Off-payroll working (IR35) and other employment status considerations This course explains how to assess employment status, the financial risk of getting it wrong, and a variety of modern employment practices.

The CIPP’s policy and research team provides an update on developments Policy team update

F or many, the key event in September was the start of the new school year, but for payroll professionals, National Payroll Week (NPW) will have also been a momentous occasion. NPW took place 6-10 September and was an opportunity to celebrate the profession, and look back on all the hard work payroll teams have achieved, particularly over the past eighteen months. The policy team kicked off the week, discussing recent and upcoming legislative changes. The team presented and chaired at several other events throughout the week, including the first face-to-face roundtable held in 2021. Gemma Mullis supported the advisory team with a Q&A session, and Sam Johnson led a discussion group looking ‘beyond the pandemic.’ As always, the team gave opportunities for attendees to interact – continuing to ensure the profession’s voice was heard.

that their tax code will change to account for the adjustment to their benefits in kind, and instead, an amount will now be processed through payroll each month and subject to tax. The updated guidance can be located here: http://ow.ly/VAIi30rTR2m. This is a fantastic example of the impact the CIPP voice, and the voice our members, can have. The strong links the CIPP continues to build with HMRC resulted in a direct change to guidance. When CIPP members communicate with the policy team and advise what is, and isn’t, working well, these invaluable insights are often shared with HMRC. It is crucial for members to continue to use their voice in this way to bring about change and improvements for the profession. Events NPW was a roaring success, with more than 2,000 delegates registered across fifteen events. The policy team would like to thank everyone involved in making it such a fantastic celebration of the profession. The Annual Conference and Exhibition will soon be upon us – on the 6 and 7 October 2021. The team has been busy, alongside other CIPP departments, in ensuring the event will be as informative and interesting as possible for all of you planning to attend. We look forward to seeing you there, albeit on a virtual basis for this year. Policy lead, Sam Johnson, loves to be kept busy, and will be appearing at Phase 3’s Festival of Knowledge on 13 October 2021 to discuss how to solve problems in payroll. Given the tumultuous eighteen months the profession has just endured, this session should provide some great tips and insights into resolving issues that payroll teams may encounter. A new addition to the team! You will meet him again later in the magazine, but we are so excited we are mentioning it twice. We are delighted to welcome Mat into the policy team in the position of policy and research officer, and cannot wait to get him involved in presenting, writing articles, and conveying the voice of the payroll profession. n

Visit cipp.org.uk/training to book your place

You spoke, HMRC listened – payrolling of benefits

CPD 3 points

The CIPP published a survey which explored how organisations report the taxable benefits in kind they offer to their employees. The questions asked which method, or methods, were used and aimed to understand why different organisations used different processes. Her Majesty's Revenue and Customs (HMRC) is continuing to refer to P11Ds as being the ‘legacy’ process, so the policy team asked those who attended the BeConnected national forums what the main barriers were to payrolling benefits, and why some of them continued to operate P11Ds. Feedback from the survey and the forums was collated and passed to HMRC. A big concern for businesses was that, in the transition year where employees move from P11Ds to payrolling benefits, employees will be impacted by double taxation. As a result of this feedback, HMRC’s guidance on payrolling benefits was updated to clarify what happens in this scenario. The guidance now specifically advises that employees should be notified they will not be taxed twice because their employer has registered to payroll their benefits with HMRC prior to the start of a new tax year. Employers will need to advise employees

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| Professional in Payroll, Pensions and Reward |

Issue 74 | October 2021

MY CIPP

The CIPP's Advisory Service team provides answers to popular questions

Q: When an employee is reinstated, can you use their previous payroll number? A: If an individual is re-employed, they are classed as a new employee for the purposes of tax and national insurance (NI) and must be treated as such when they are processed through payroll. A new employee ID is required. The only time an employee’s closed payroll record can be used for making additional payments is when an outstanding payment is due to the individual after they have left employment. For reference see: http:// ow.ly/JRjs30rSdTE. Q: A client based in the USA does not have a business presence in the UK. They have employed two UK resident workers to work remotely in the UK. How would we enrol them into an approved pension scheme when there is no UK business presence? National Employment Savings Trust (NEST) pensions advised that its schemes can only be used by UK-based companies with UK bank accounts and a pay as you earn (PAYE) scheme. A: Under UK pensions legislation an employee must be auto enrolled into a pension scheme when they: ● are classified as a worker ● are aged between 22 and ‘State Pension Age’ ● earn more than £10,000 per year ● ‘ordinarily’ work in the UK ● aren’t already part of a qualifying workplace pension scheme. There are UK pension schemes that can be used by overseas employers to comply with UK pensions legislation. These pension schemes assist the US company in transferring funds into a UK approved pension scheme or will assist the company in setting up a UK bank account. The CIPP advises members to contact independent pensions advisors or international human resource (HR) advisors for their assistance with this. In the interim, an overseas employer

could postpone pensions enrolment for up to three calendar months following the start date of employment, giving them time to make suitable arrangements. Q: A business intends to hold a lucky dip raffle for its employees. The prizes will include holidays and televisions costing between £500 and £2,500. Entry to the raffle will be free for all employees as it is not performance related. Will these raffle prizes be a taxable benefit and reportable on our PAYE settlement agreement (PSA)? A: In Her Majesty’s Revenue and Customs (HMRC’s) Employment Income Manual, it states “it is sometimes argued that the raffle or lottery results in prizes being awarded by chance and not by reason of the employment. This contention should not be accepted unless it can be shown that the draw was equally open to members of the public, on the same terms as employees”. For reference, see: https:// bit.ly/3lRdcsM. Unless the raffle is open to members of the public, a benefit in kind arises and this would be at a cost to the employer for providing the raffle. Please see section 204 of the Income Tax (Earning and Pensions) Act 2003 (ITEPA) for more information: https://bit.ly/3jF26UN. The employer could approach HMRC to request that the company settle the tax on behalf of the employees via a PSA, as the raffle prize is much more likely to be considered a minor, irregular or an impracticable benefit in kind to operate. Q: The company has a PSA in place. We know the deadline for making payment is 22 October but cannot find any guidance on the deadline for submission of the PSA computation. Is there any guidance available? A: HMRC guidance explains that form PSA1 should be used to calculate the amount due. If the form is not used, HMRC will calculate the amount, but there

will be an extra charge where this happens. The completed form should be sent to HMRC as soon as possible following the end of the tax year. HMRC will confirm the total tax and NI due prior to 19 October following the tax year the PSA covers. The guidance can be located here: http:// ow.ly/oGWA30rSRz0. The deadline for applying for a PSA is 6 July and payment is due by 22 October if an employer pays their liability electronically. The guidelines on submission of the computation sheet are vague but the CIPP advises that employers aim to submit form PSA1 by 6 July to allow HMRC time to raise queries if necessary. This also allows time for corrections to be made if required. For reference see: https://bit.ly/3s6mJwT. Q: Instead of holding its annual summer barbecue this year, a company gave staff members a £50 (non- cash) voucher. Would this amount be regarded as an exempt benefit under trivial benefit rules? A: Section 323A of the Income Tax (Earnings and Pensions) Act 2003 (ITEPA) sets out a statutory exemption for trivial benefits. Under this exemption, if an employer provides a benefit to its employees, the benefit is exempt from tax as employment income if all the following conditions are satisfied: ● the cost of providing the benefit does not exceed £50 ● the benefit is not cash or a cash voucher ● the employee is not entitled to the benefit as part of any contractual obligation ● the benefit is not provided in recognition of services performed by the employee as part of their employment duties (or in anticipation of such services). For reference see: https://bit.ly/3yxpNVk. Q: The company paid for employee taxis to and from work during the pandemic and now wishes to settle the tax on behalf of the employees via

| Professional in Payroll, Pensions and Reward | October 2021 | Issue 74 10

Policy hub

A: On 7 September 2021, prime minister, Boris Johnson, announced that a new 1.25% Health and Social Care Levy, based on NICs, would be implemented from tax year 2022/23. For the first year of its implementation, the Levy will not impact individuals who are state pension age and above, and still working, as it will be collected via NICs. Currently, those who are state pension age and above are placed on NI category letter C, under which no employee NI deductions are taken. This will remain the case for tax year 2022/23, so they are not impacted. For working age employees, the self- employed and employers, NIC rates will be increased by 1.25% for that year. From tax year 2023/24, however, the Health and Social Care levy will be formally separated out as a deduction in its own right, and NIC rates will revert to 2021/22 levels. At this point, employers are required to clearly state the levy as a new deduction element on employee payslips, and those who are state pension age and above, and still working, will be required to pay the 1.25% levy. n

a PSA, but this has not been agreed with HMRC – is it too late to request an addendum to an existing agreement? A: If an employer has reportable benefits that relate to coronavirus only and they wish to settle the tax on behalf of employees via the PSA, HMRC will not issue an amended P626. Instead, HMRC is informing employers to email lbs.compliance@ hmrc.gov.uk providing details of the items they wish to include. HMRC will add an amendment to the current agreement for the 2020-2021 tax year.

employment since leaving the regular armed forces, and ends twelve months later. For the first year of the policy’s implementation, from April 2021 – March 2022, employers are required to pay the secondary Class 1 NICs due on the earnings of veterans as normal and will have the option to claim it back retrospectively. From April 2022 onwards, a solution will be introduced so that the relief can be applied through PAYE. NIC category letter V will be introduced, and this will mirror category A. HMRC has also confirmed that a new Veterans Upper Secondary Threshold (VUST) will be created. Employer relief can be applied to earnings below the VUST. Employers can claim relief even where the employment starts prior to 6 April 2021 but can only claim for the remaining qualifying period. For reference see: https://bit.ly/2UbXnBu. Q: Following the recent announcement regarding the Health and Social Care Levy, we understand that those who are state pension age and above, and still working, will be required to contribute. How will this work?

See the April edition of HMRC’s Employer Bulletin : http://ow.ly/ lasc30rSCE9.

Q: The company recently employed a veteran. We have confirmed this is their first civilian employment since leaving the army. We are aware that we can reclaim the cost of the employer National Insurance Contributions (NICs), but how is this done? A: The HMRC policy, implemented from 2021, made it possible for employers to claim relief if they employed a veteran during the qualifying period, which commences with the veteran’s first civilian

CPD 15 points

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* A DAY FOR NON-COMPLIANCE?

Certificate in Pensions Administration The Certificate in Pensions Administration has been developed with pension practitioners to ensure that it meets the needs of the industry. It provides payroll and pension staff with relevant training so businesses can safeguard against the financial risk for non-compliance.

*correct at time of publication

Don’t miss out on the Autumn intake, enrol at cipp.org.uk/study before 19 October to secure your place.

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| Professional in Payroll, Pensions and Reward |

Issue 74 | October 2021

MY CIPP

Market insight survey

Joanne Hudson ACIPP, CIPP’smarketingmanager , gives an overviewof the research that asks what YOUwant us to deliver

Introduction In early 2021, the CIPP conducted its annual market insight survey. As a membership organisation, it is vital for the CIPP to monitor the level of service it provides and the relevance of products it delivers to its members. Some of the key objectives of the 2021 survey were as follows: ● to monitor customer satisfaction levels via a net promoter score (NPS), using direct comparison to the previous year’s score ● to discover the appetite for online benefits, products and services ● to understand how the organisation can communicate to a younger membership base. Members of the CIPP, along with non- non-members, were invited to participate in the survey via News Online, email

The primary reason payroll professionals contact the CIPP is to use its Advisory Service

campaigns, social media and on the CIPP website. The survey received 602 responses in total. Customer satisfaction: NPS The NPS is used to establish the likelihood of customers recommending the CIPP to friends and colleagues. This was the second time the NPS has been used within the Market Insight Survey. In the 2020 survey, the NPS was 48. The score from the 2021 survey was 59 – a vast improvement. An NPS of 59 is considered ‘excellent’ and we will aim to reach a score of 70, classed as

‘exceptional’, over the course of the next few years. Customer service is key to the success and operation of the CIPP for all its members and service users. Throughout the pandemic, we have strived to keep payroll professionals up to date with ever- changing legislation and guidelines. We have ensured our customer-facing teams are available to communicate with and assist the payroll profession in keeping the UK paid. (see fig 1) Key issues facing the profession and how the CIPP can help Although we are aware the coronavirus pandemic was, and still is, the main issue facing the profession (46% of the 535 respondents to this question stated this as their main concern), it was interesting to see what the other primary areas of concern were. They were as follows: ● maintaining up to date knowledge and skills ● off-payroll working (IR35) ● holiday pay ● payrolling benefits in kind. To assist the payroll profession with these concerns, we created our BeKnowledgeable webinar sessions. These

Fig. 1

| Professional in Payroll, Pensions and Reward | October 2021 | Issue 74 12

My CIPP

Fig. 2

sessions were approximately an hour long and free to attend for all membership levels. They were hosted by members of the policy team. The webinars focused on a range of topics, including those listed above, and were designed as a fast and accessible way to improve knowledge and skills. They also presented the opportunity for members to ask the policy team any questions they may have had. Approximately 3,000 people registered to attend these sessions, and more are planned in the near future. Your main reasons for contacting the CIPP The primary reason payroll professionals contact the CIPP is to use its Advisory Service. An overwhelming 65% of respondents confirmed this. There was a surge in demand for the service during the pandemic, as the team saw an increase of 56% to queries in 2020 and of 15% in 2021 when compared to figures taken from March to August 2019. The Advisory Service was also identified as the most frequently used benefit in 2020. The team recently recruited a new member, as Karen Wareham joined in April 2021 to help ensure queries were answered as quickly and accurately as possible. The Payroll Reference Book The Compact Payroll Reference Book was introduced in 2019 as a membership benefit for associate, full, Chartered and fellow members. In 2020, when asked how the book could be improved, you told us you’d like the book to be bigger. Eager to improve our online and digital offerings, we asked how many people would be interested in an online version of the book. A huge 77% of respondents stated they

would be interested. This has now been actioned, based on your feedback. Associate members and above can now access the newly titled Payroll Reference Book online via the Member Offers section of the website. (see fig 2) Professional magazine A huge thank you to those of you (95%) who stated that the magazine content is relevant to your role. We are continuing to explore new topics and areas of discussion for inclusion in the magazine. Should you have any suggestions you’d like to share, then please email editor@cipp.org.uk . There were varied comments relating to the printed and the online version. Some respondents commented how A huge thank you to those of you (95%) who stated that the magazine content is relevant to your role

much they enjoy the printed version and that they share it with colleagues, whilst others stated they prefer to read it online and want to reduce their impact on the environment. We will continue to explore the various options available and will communicate any changes as and when appropriate. (see fig 3) New to the profession One of the objectives of this survey was to assess our customer base and to explore how we can attract a ‘new to the payroll industry’ audience. From the survey results, we can see that approximately 70% of the respondents have been in the profession between ten and twenty years. Only approximately 10% of respondents confirmed they had been in the industry for a period between less than six months and five years. For the CIPP to assist those new to the industry, we need to be able to communicate our services to them. With this in mind, we have created a series of new brand awareness and marketing campaigns, targeting those who are new to the industry. We are also in the process of expanding our reach across social media channels. 43% of respondents to the question revealed they currently follow us on social media. The aim is to improve this figure over the next year, ensuring we are reaching a wider audience. Thank you to all of you who took the time to participate in the survey and help us understand our customer base and its needs in more detail. The 2021/22 market insight survey will be created over the next few months, and we will, once again, be asking for your invaluable input on our products, services and plans. n

Fig. 3

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| Professional in Payroll, Pensions and Reward |

Issue 74 | October 2021

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