Professional March 2019

PAYROLL INSIGHT

SamanthaMann CIPPMAATMCIPPdip, CIPP senior policy and research officer, focuses on changes now in sight in the imminent new tax year 2019/2020 vision

I n some years the changes impacting the payroll profession are headline grabbing and seem to be the subject of almost every conversation – such as real time information and automatic enrolment, shared parental leave and pay and gender pay gap reporting, to name but a few. But for other years the changes are less headline grabbing but equally as impactful. This look ahead aims to discuss a selection of subjects that will impact the working lives of many of us during 2019–20. Historically, as we look ahead to the new fiscal year – and I readily acknowledge that you will have been doing this for some time now – we may be looking out for changes to rates and thresholds, as well as to legislation

impacting employment and, increasingly, to government strategy.

rates and bands are shown in Table 1. The higher rate threshold is £50,000. ● ● Welsh income tax – In January, the Welsh Assembly ratified the rates that would apply from 6 April. Though these will shadow those applicable to England and Northern Ireland, we may find they diverge in a later tax year. In recent months, Welsh resident taxpayers and their employers will have been receiving tax codes that begin with ‘C’, based on the information that HM Revenue & Customs (HMRC) holds about the employee. It is more important than ever for employees to keep HMRC updated when they change their address (or any other relevant details). HMRC’s preferred method for doing this is via the personal tax account but details can still be changed via its telephone helpline service. ● ● Scottish income tax – At the time of writing, the rates, bands and thresholds were to be debated and ratified by the Scottish Parliament in February 2019. Thus, like previous years, the rates etc proposed in the budget for Scotland (see Table 2) may be subject to change. National minimum wage The Low Pay Commission (LPC), which is an independent body established in 1997, annually advises the government about the national living wage (NLW) and the national minimum wage (NMW). In the 2018 autumn budget, the Chancellor accepted in full all rate recommendations

Tax rates, bands and thresholds No look ahead from a payroll perspective would be complete without a nod to the tax rates and thresholds and the simplicity of the past is just that – in the past – as we now look to no less than three UK nations to see what rates and thresholds will apply for the 2019–20 tax year. ● England and Northern Ireland – The ...the simplicity of the past is just that – in the past ...

Table 1

England, Northern Ireland, Wales

Basic rate

20% 40% 45%

£1–£37,500

Higher rate*

£37,501–£150,000

Additional rate

>£150,001

*Higher rate threshold is £50,000

Table 2

Scottish income tax

Starter rate Basic rate

19% 20% 21% 41% 46%

£1–£2,049

£2,050–£12,444 £12,445–£30,930

Intermediate rate

Higher rate*

£30,931–£150,000

Top rate

>£150,001

*Higher rate threshold is £43,430

| Professional in Payroll, Pensions and Reward | March 2019 | Issue 48 20

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