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Scottish earnings arrestment, as there appears to be conflicting guidance online. The Scottish Courts state that “the employer calculates the rates of all deductions using fixed tables as set down by regulations” which implies the latest tables. However, there is guidance that states “When new tables are issued, the employer is not under a legal obligation to apply the amended bands to existing orders unless he is requested to do so by way of the appropriate form. The employer may apply the amended bands if he chooses to.” Can you please confirm which guidance is correct? A: Having looked at the legislation, it would appear that the rate which was originally used when the arrestment was sent is the rate that you should use for the duration of the order. If you receive notification of the rate increasing (or decreasing), then it is at your discretion as to whether you apply the new rate or continue to use the rate that you currently do. Please see this link which supports this: https://bit.ly/2tChl7h. Q: How are average weekly earnings (AWE) to be calculated for an employee who wants to take surrogacy leave which I understand should be processed as adoption following HMRC guidelines? The surrogate lives in Canada. The father, who is genetically related to the child, will be requesting a parental order and will be the primary carer for the child. A: The employee is applying not for surrogacy leave but for either statutory adoption pay/leave (SAP/SAL) or statutory paternity pay/leave (SPP/SPL) under surrogacy. It is important to determine which of these the employee wants. To be entitled to SAP/SAL the employee must have, or be applying for, a parental order. If both parents have statutory entitlements, they would need to decide who is taking SAP/SAL and who is taking SPP/SPL; alternatively, they could choose to change this to SShPL and pay. Where the employee is taking SAL/SAP you would use the rules for SMP. Intending parents have a day-one right to SAP/SAL if they satisfy the qualifying conditions, which mirror SMP conditions. n
£702.00 (i.e. the NICs lower earnings level) from both figures so pre-sacrifice NICs would be £1,053.12 and post-sacrifice would be £972.62. I calculate the saving for the employer as £80.50; so half of that is £40.25. Q: How would you calculate student loan deductions where there is a student loan type 1 and post graduate loan (PGL)? A: This link to the Student Loan Company’s website – https://bit.ly/19gREvX – explains how an individual’s loan repayments are calculated where the employee has both type 1 and PGL. Using the example in the link when an employee earns £2,083.00 per month, to calculate manually the correct deductions you calculate the PGL first, followed by the type 1 loan. ● ● PGL – take the monthly threshold of £1,750.00, and deduct it from NICable pay which is £2,083.00, giving £333.00. Then you multiply that by 6%, producing £19.90 which is rounded down to £19.00. ● ● Type 1 loan – deduct £1,527.00 (the monthly threshold for a type 1 loan) from NICable pay of £2,083.00, giving £556.00 which is then multiplied by 9% producing £50.04 which is rounded down to £50.00. Q: Are micro employers, with ten or fewer employees, exempt from having to operate an attachment of earnings order? A: It doesn’t matter how many employees Q: When a person reaches SPA and their NICs category is changed to ‘C’, so they cease to make primary contributions, is it still appropriate to make student loan deductions through the payroll? A: Student loan repayments aren’t affected by how much (or if any) NICs are made. Though the figure to use for the student loan calculation is the same as the earnings used to calculate the NICs, the calculations are separate. You should continue to make student loan deductions and only stop making them if you receive a stop notice from HMRC. the employer has; an attachment of earnings order must be operated.
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| Professional in Payroll, Pensions and Reward |
Issue 49 | April 2019
*correct at time of publication
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