The Chartered Institute of Payroll Professionals
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what’s planned for 2024.
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Have a read to see what the board sees as ongoing concerns for HMRC and small businesses. Also keep an eye out for the ‘Tell ABAB’ survey, this survey gets your opinion on how you think HMRC is doing against key metrics, a report is then compiled completely independently from HMRC to paint a clear and unbiased picture.
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HMRC publishes tax simplification update, including the mandating of payrolling benefits in kind Published: 16 January 2024 Emailed: 17 January 2024
HM Revenue and Customs (HMRC) has released a tax simplification update confirming that the payrolling of benefits will become mandatory from April 2026.
The current process allows employers to either submit P11D to report the employees benefits for taxation purposes or register to payroll benefits, allowing the benefits to be taxed in real time through PAYE.
Employers can currently payroll all benefits with the exception of:
employer provided living accommodation
interest free and low interest (beneficial) loans
Clarification will be required on how these benefits will be taxed as part of the changes.
Currently the submission of the P11D(b) is still a requirement to report the liability of the Class 1A National Insurance contributions (NICs), even if the benefits are taxed through the payroll. The HMRC update outlines that the reporting and paying of Class 1A NICs will also move to be processed via the payroll software.
The HMRC website has full details of the current process .
This represents a significant shift in how benefits are processed, the input of payroll professionals will be key to the successful implementation of these changes. Watch this space as the CIPP policy team will be wanting your feedback, ideas, and thoughts on the proposed changes as more information becomes available.
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HMRC has updated National Insurance Contribution (NIC) rates and tables Published: 12 January 2024 Emailed: 17 January 2024
Following the 6 January launch of the new NIC rates, HMRC has updated guidance manuals and the rates and tables on Gov.uk with the blended rates for Directors NICs.
Directors NIC considerations:
directors who have left within the 2023/24 tax year will need their NICs recalculated to take the blended rate of class 1 NICs into consideration
directors who remain in employment and have their NICs calculated using the alternative method, will need to be changed to the cumulative calculation in their final pay period of the tax year, to ensure their NICs are calculated using the blended rate.
Further information can be found HMRC NI rates and letters and guidance manuals on Directors NI.
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