The Chartered Institute of Payroll Professionals ……………………………………………………………Policy News Journal
exceeds the higher rate limit for the tax year the exempt amount will be £25 for each qualifying week; exceeds the basic rate limit but not the higher rate limit then the 'exempt amount' for that tax year will be £28 for each qualifying week; otherwise the 'exempt amount' for that tax year will be £55 for each qualifying week. Following the introduction of the Scottish rate of income tax, the Scottish Parliament has set the Scottish income tax rates and thresholds for the 2017/2018 tax year. Eligibility criteria for employer provided childcare vouchers are not devolved to the Scottish Parliament and, therefore, the basic and higher income tax rates mentioned above are the UK rates.
This means that the same limits apply for all employees in the UK in receipt of childcare vouchers.
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Optional remuneration arrangements – draft guidance published 21 March 2017
Draft guidance has been published on GOV.UK to provide help employers to understand the impact of changes to tax and Class 1A National Insurance contributions treatment of benefits in kind as from the 2017-18 tax year. Employment Income Manual (EIM) guidance will be finalised and published following Royal Assent of Finance Bill 2017. If you have any comments or queries, on the guidance please contact Employment income policy team at HMRC. A common question that we at the CIPP have received since the publication of the Finance Bill 2017 clauses has been “what constitutes a change, variation or modification to the contract to ensure full protection under the transitional arrangements?”
Several examples provided within the draft EIM guidance aim to help to illustrate what might, or might not constitute a change, variation or modification of contract. What is made clear, is that:
“ An arrangement is not regarded as being varied if the variation of the arrangement is only in connection with a replacement because of accidental damage or otherwise for reasons beyond the control of the parties.
Variation of an arrangement is also disregarded if the variation is in connection with an employee’s entitlement to statutory sick pay, statutory maternity pay, statutory adoption pay, statutory paternity pay or statutory shared parental pay.” We recommend that you take a close look at the guidance and please feedback whether this helps you with your particular situation. If the draft EIM guidance doesn’t fully answer your questions or provide enough clarification, please feed back to the Employment income policy team and the CIPP policy team always value hearing from members about their experiences via policy .
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Do you make assets available to your employees or members of their family? 21 March 2017 Draft guidance for the 2017-18 tax year has been published to help employers to understand what changes have been made to the tax rules for directors or employees where an asset is made available to them for their private use but without ownership of the asset transferring. The Employment Income Manual (EIM) guidance will cease to be draft when the Finance Bill 2017 receives Royal Assent. From 6 April 2017 there will be new tax rules for directors or employees who have an asset made available to them for their private use but without ownership of the asset actually transferring. The guidance explains how to calculate the chargeable value of the benefit when an employee has an asset made available for him or her to use for private use or where the asset is used for both private and business use . Amongst other items of information the EIM Guidance includes:
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