POLICY HUB
Think strategically
Designed for ambitious payroll and pensions professionals, the CIPP’s BA (Hons) Business Management (CIPP) builds on your industry knowledge and skills to take your capabilities to a strategic level. BA (HONS) BUSINESS MANAGEMENT
on the HM Revenue and Customs (HMRC) website? A: The CEO pay gap data must be included in the annual directors’ remuneration report presented for shareholder approval, at the Annual General Meeting (AGM). There’s no deadline that all companies must meet. The reports published in 2020 had to be reflective of the financial year beginning on or after 1 January 2019. The data must be presented in table format to display total CEO remuneration as a ratio to the median, 25th and 75th percentile of employee pay. The table should be completed year-on-year, to include up to ten years’ worth of data in each annual report. Companies then need to include supporting explanations to put the findings into context. This includes the method used to calculate the ratio and reasons as to why the ratio may have changed from the previous year. The company must also confirm whether they believe the median is reasonable. It’s a legal requirement for large, listed companies that their annual directors’ remuneration report is available free of charge on their company’s website for ten years. Payroll bridging loans Q: We have a customer who wishes to move their pay period backwards. They currently pay mostly in advance but want to pay in arrears, so employees will, in effect, be without pay for a month. To help with this, they want to provide bridging loans for the difference in net in the month of the change, which the employee will pay back over a set period, interest free. Could you please advise: 1) whether there’s any specific guidance around payroll bridging loans being exempt from P11D reporting?
2) if the answer to the above is no, do we just apply the rule that as long as the total of all qualifying loans is under £10,00 within the tax year, there’s no taxable benefit? 3) does the loan have to be paid within the same tax year as it was given, or could this be repaid over a longer period and remain tax-free? A: The employment-related loan legislation is designed to tax the benefit of a loan to an employee or officer where the loan value is over £10,000 at any time in the tax year, and either no interest is paid or interest below the official rate (currently 2.5%) is paid by the borrower. Please see Section180 of the Income Tax (Earnings and Pensions) Act 2003, here: http:// ow.ly/CpIq50MRBQx. If the loan doesn’t exceed this limit, then there are no reporting requirements providing the employee repays the cost of the loan within the agreed timeframe. Recording correct names on payroll systems Q: We have a few doctors who work for us who have different surnames from a medical point of view (e.g., Dr White, but they’re married and their legal married surname is Mrs Black), and we’re not sure what surnames to use in the payroll system. Do their surnames need to be their legal surnames on the payroll system, or does it not matter as we hold their NI numbers? A: The names on the payroll system should match the names HM Revenue and Customs (HMRC) has on record for them. When an employee changes their surname, they should advise HMRC of this. This follows marriage, divorce, deed poll etc. Sometimes an employee has a legal name but wants to be known by another name, so a payroll system may have a field in which their ‘known as’ name can be populated. n
Visit cipp.org.uk/study for details and to enrol
Delivered in conjunction with
Member price: £1,047 + VAT Non-member price: £1,347 + VAT LINCOLN INTERNATIONAL BUSINESS SCHOOL
Scan to book
What are the CEO pay ratio reporting requirements?
11
| Professional in Payroll, Pensions and Reward |
Issue 88 | March 2023
Made with FlippingBook - Online magazine maker