POLICY HUB
there doesn’t seem to be much information regarding linked companies. We have two subsidiary companies (so there’s three companies in total). Can we claim for each company or just once for the whole group? A: Even though the autumn budget 2024 removed the previous £100,000 eligibility threshold, allowing more companies to claim the employment allowance, and increased the amount from £5,000 to £10,500, the rules around connected companies do still apply. The relevant guidance can be located here: https:// ow.ly/vK0J50VrtTI. Recovering overpayments and NMW Q: An employee earns the NMW and reduced their hours back in December, but the payroll team wasn’t notified, so they’ve been overpaid. They’re happy for us to recover the overpayment, but if we take this from the employee’s gross pay will this be in breach of NMW rules? A: An employee is protected from an unlawful deduction of wages under the Employment Rights Act 1996. To make a deduction, the employee must have
l all contributions received l all other payments to and from the scheme l transfers of members’ benefits and related assets You must keep records for at least six years. You’ll need to keep some for a much longer period. “How long to keep records You will need to keep some records, including both common and scheme- specific data, for long periods of time. This means for as long as they remain relevant and are needed for the scheme to operate.”
agreed to this in writing prior, for example, through their contract of employment or a repayment plan. You should recover the net amount (not the gross overpayment figure) from the employee, as this is the amount they actually received. This can be achieved by revisiting the period in which the overpayment was made and recalculating that period to reflect the reduction in gross pay, while also refunding any overpaid tax and National Insurance. A genuine accidental overpayment doesn’t reduce NMW when being recovered, as per Regulation 12(2)(c) of The National Minimum Wage Regulations 2015 - The National Minimum Wage Regulations: https://ow.ly/ckx450VruTM. n
What are the record keeping requirements for payroll and pension records?
Employment allowance updates Q: Following the employment allowance updates from April 2025, it seems our organisation can now claim. However,
Are there any NMW considerations when recovering an overpayment?
LEVEL 5
NEW First intake October 2025
elevate your career towards leadership PAYROLL MANAGEMENT DIPLOMA
Master critical thinking, problem solving and project management skills, whilst gaining essential insight into technologies such as artificial intelligence (AI) and robotic process automation (RPA) enabling you to confidently lead the future of payroll.
Developed, assessed and awarded by IPP Education
SCAN TO BOOK
For more information, please visit ippe.org.uk/study or scan the QR code
A subsidiary of the Chartered Institute of Payroll Professionals
9
| Professional in Payroll, Pensions and Reward |
Issue 110 | May 2025
Made with FlippingBook - Online magazine maker