PAYROLL INSIGHT
Begin with the end in sight
Mike Nicholas MCIPP provides a checklist of key information for the end and beginning of tax years
A lthough real time information (RTI) has fundamentally altered payroll procedures and processes around the end of one tax year and the start of the next, the period is still a busy time for payroll professionals. Indeed, in some ways the period has become rather more congested and complicated in terms of things that must be done. The following is intended to outline issues and changes around the tax year end/start, not to explain them in detail. So, where anything is unclear you should seek guidance (e.g. from CIPP’s Advisory Service or from your payroll software/service provider). See Payroll news on page 15 for information about: car mileage rates from 1 March; and the amount of a week’s pay and the daily amount of guaranteed pay.
National minimum/living wage On 1 April new rates for the national minimum wage (NMW) (which includes the national living wage) apply to workers’ pay reference periods starting on or after this date. A worker’s pay reference period is either a month or if the worker is paid by reference to a period shorter than a month, that period, and cannot be longer than one calendar month. Table A shows the minimum wage rates from 1 April.
Table A – Minimum wages rates
Worker’s age/type
1 April 2018
25 and over
£7.83
Key dates for changes
21 to 24 18 to 20 Under 18
£7.38
National minimum/living wage Statutory payments
1 April
£5.90 £4.20 £3.70 £7.00
Register for payrolling Week 53, 54, 56
5 April
Apprentices*
Accommodation daily offset
Statutory sick pay Income tax National insurance Collection of student loans Automatic enrolment PAYE Benefits in kind
*Note that the rate shown applies to apprentices under 19 and to those aged 19 and over who are in the first year of their apprenticeship. Apprentices aged 19 and over in their second and subsequent years of apprenticeship must be paid the appropriate NMW relevant to their age.
6 April
Statutory payments The statutory payments comprise statutory maternity pay (SMP), statutory paternity pay (SPP), statutory adoption pay (SAP) and statutory shared parental pay (SShPP). The standard weekly rate for these is £145.18, and the equivalent daily rate is £20.74. This rate applies from 1 April except where the employee’s SMP, SPP, SAP or SShPP period started on a day other than a Sunday; in which event, it operates from the first complete SMP, SPP, SAP, SShPP week following Sunday 1 April. In 2018–19, the rate of recovery for these statutory payments is: ● 92% if the employer’s total class 1 National Insurance contributions (NICs) liability for 2017–18 was above £45,000, or ● 103% if the employer’s total class 1 NICs liability for 2017–18 was £45,000 or lower.
| Professional in Payroll, Pensions and Reward | April 2018 | Issue 39 22
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