Payroll
● Class 1A NICs on termination payments and sporting testimonials – The ‘will it or won’t it’ saga should finally reach a conclusion as we see the RTI process welcome the real time calculation and payment of class 1A NICs on termination amounts in excess of £30,000 and on sporting testimonials in excess of £100,000. This is a subject that continues to keep the CIPP Advisory team busy as members have to contend with the concept and calculation of the post employment notice pay formula From 6 April 2020, the amount of class 1A NICs due must be reported and once reported, the FPS will hold that information until the end of the tax year. This isn’t a widespread introduction of real time class 1A NICs. If the employer payrolls the values of benefits in kind (BIKs) any class 1A NICs liability must still be accounted for in the usual manner. ● ULEV and WLTP – For all employers that provide company cars there is new information to be reported from the 2020/21 tax year. For employers reporting BIKs via the P11D return process, they will report using the additional data from July 2021, although the P46(Car) return will be
adapted to account for these changes. Five new bands are to be added to the percentage ready reckoner where the car has an approved CO2 emission range – specifically when it is an ultra-low emission vehicle (ULEV) with CO2 emissions of less than 75g/km.
company car regime is due to the change brought in as a result of compliance with the worldwide harmonised light vehicle test procedure (WLTP). This is late in being introduced, but from the 2020/21 tax year a second table of appropriate percentages for cars that are registered from 6 April 2020 is applicable. Cars that are registered before 6 April 2020 will continue to hold their CO2 figure under the old testing for the life of the car. On a final note, if you have decided to payroll BIKs – and there are many good reasons to do so – be aware you will need to register your intentions with HM Revenue & Customs before the end of the 2019/20 tax year i.e. 5 April 2020. Final comment There is so much more that could be discussed in relation to the new tax year. So, if any these subjects covered has come as a surprise to you, make a new tax year resolution to attend a national forum. They are available to associate, full, fellow and Chartered members and provide an opportunity to meet other members and to discuss issues of the day and those planned for the future. n
...compliance with the worldwide harmonised
light vehicle test procedure (WLTP)
Where the hybrid company car has a CO2 figure within the range 1–50g/km, the bands will focus on the car’s electric mileage range or zero emission mileage. Put into plain language – how far that car will travel in electric mode before the battery needs to be charged again. This information will need to be recorded at the beginning of each tax year and/or when there is a change made. A further change being made to the
P11D, EXPENSES AND BENEFITS
Designed to give delegates clarity and confidence about how to process the P11D, P11Db forms, PAYE Settlement Agreements (PSA) and net to gross calculations. ● Identifying the different returns for expenses and benefits ● Identifying the various schemes with which benefits are offered ● Calculate grossing up correctly ● Summarise the purpose of PAYE Settlement Agreements (PSAs) ● Demonstrate form P11D completion ● Identifying the record-keeping requirements for benefits and expenses ● Summarising the principles of travel and subsistence expenses
Visit cipp.org.uk/training , email enquiries@cipp.org.uk or call 0121 712 1000 for more information.
@CIPP_UK
cipp.org.uk CIPP_UK cip .org.uk
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| Professional in Payroll, Pensions and Reward |
Issue 58 | March 2020
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