Payroll news
AE earnings trigger and thresholds THE DEPARTMENT for Work and Pensions (DWP) has published its proposed earnings trigger and qualifying earnings (QE) thresholds for 2017–18. The table shows the amounts for pay reference periods of various lengths.
Scottish income tax IN DECEMBER 2016, the Scottish Government confirmed its approach to Scottish income tax by proposing to increase the higher rate threshold to £43,430 in 2017/18. A factsheet providing information on the Scottish Government’s proposals can be found at http://bit.ly/2iUJJO4. from tax year 2017–18 if their payroll software facilitates this, which will allow HMRC to identify and resolve any issues with employers before the introduction of mandatory reporting. Change of address THOUGH IT is the individual’s responsibility to notify HMRC of a change of address, employers can encourage employees to update their details using their PTA. If the employee cannot do this, the employer can complete the employee address boxes in the next FPS. HMRC’s records are automatically updated once three FPS submissions have been received with the new address displayed in exactly the same format. Employers updating an employee’s address via FPSs must ensure correct completion of the address boxes by: ● not entering a foreign country on a UK address ● not using ‘care of’ the employer’s address – the employee’s address must be entered ● entering a flat/apartment number if there are multiple flats/apartments in a building ● entering the employee’s full address. However, HMRC will not update its records where either: ● a change of address is provided in an earlier year update return, or ● any of the following items has been indicated in a FPS: payment after leaving, one off payment, payment to a non- individual. Car and car fuel benefit FROM APRIL 2018, employers payrolling car and fuel benefits will be required to report information about these in FPSs. However, these employers can voluntarily choose to report car data through FPSs
Pay reference period
2017–18
1 week
2 weeks
4 weeks
1 month
3 months
6 months
12 months
Lower level of QE
£113 £226 £452 £490 £1,469 £2,938 £5,876
Earnings trigger
£192 £384 £768 £833 £2,499 £4,998 £10,000
Upper level of QE
£866 £1,731 £3,462 £3,750 £11,250 £22,500 £45,000
HMRC administration of SRIT ACCORDING TO a National Audit Office (NAO) report (http://bit.ly/2iNFow9), HM Revenue & Customs (HMRC) faces significant challenges in ensuring that all Scottish taxpayers are correctly identified for the purpose of the Scottish rate of income tax (SRIT). The key challenge for HMRC is the maintaining and updating of its record of address details in order to identify Scottish rate taxpayers. Some 2,450,000 individuals have been identified as potential Scottish taxpayers, with Scottish taxpayer notification letters being issued. The NAO observes that as HMRC’s ability to ensure the amount of tax collected for the Scottish Government will be undermined where taxpayers fail to update their address details, HMRC should continue to communicate this key message to taxpayers. (See news piece ‘Change of address’ for guidance.) In 2015–16, HMRC spent £1,081,000 on communications with potential Scottish taxpayers about SRIT, and was reimbursed £8,400,000 by the Scottish Government in respect of implementing SRIT. An error in the design of HMRC’s taxpayer identification exercise in December 2015, resulted in 420,000 potential Scottish taxpayers not receiving a notification letter. An interim solution was in place by June 2016 to issue coding notices for the 2016–17 tax year to these taxpayers and a permanent IT solution was implemented in October 2016 to bring them within HMRC’s automated process for future years and to ensure that all in-year changes of Scottish taxpayer status for them were correctly reflected in 2016–17 codes. The NAO notes that by not issuing the same level of information to the 420,000 as the 2.45 million taxpayers originally identified in December 2015, HMRC may have created a less informed group of taxpayers. The ability to provide an IT solution allowing personal pension providers to claim relief at source continues to be a significant risk. Divergence of tax rates between Scotland and the rest of the UK will mean Scottish taxpayers being due a different rate of relief-at-source on their personal pension contributions. From 2018, HMRC must notify pension providers of the correct rate of income tax for their scheme members to allow pension providers to apply the correct rate of relief-at-source. HMRC is working with the pensions industry to deliver the solution required for the relief at source system to accommodate the SRIT.
Advisory fuel rates THE ADVISORY fuel rates changed with effect 1 December 2016 and apply, until further notice, to all journeys made on or after this date. For one month from the date of change, employers could choose to use either the previous or revised rates. Employers may therefore make or require supplementary payments if they so wish, but are under no obligation to do either.
Engine size Petrol
Diesel
LPG
Up to 1400cc
11p 9p 7p
1401cc to 1600cc 1601cc to 2000cc
9p
14p
9p
11p
Over 2000cc
21p 13p 13p
17
Issue 27 | February 2017
| Professional in Payroll, Pensions and Reward |
Made with FlippingBook - Online magazine maker