The Chartered Institute of Payroll Professionals
News On Line
Spring Budget
Spring Budget 2024 date confirmed Published: 3 January 2024 Emailed: 3 January 2024
The Chancellor of the Exchequer, Jeremy Hunt, has announced he will present the Spring Budget 2024 to parliament on 6 March 2024.
The Office for Budget Responsibility (OBR) has been commissioned to prepare an economic and fiscal forecast to be presented to Parliament alongside the Spring Budget.
Keep an eye on the CIPP news page for the latest updates impacting the payroll and pension industries, as the policy team digest the news as it’s announced. The team will produce a Spring Budget summary to give you a one stop document to understand all the announcements made.
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National Insurance contributions reduced further from April Published: 6 March 2024 Emailed: 13 March 2024
Payroll professionals are accustomed to seeing announcements in fiscal statements impacting the work we carry out, and this certainly has been the case over the last couple of years, with several changes made to National Insurance (NI). Speculation prior to the Budget proved to be correct, as Jeremy Hunt announced, “the money you earn doesn’t belong to the government, it belongs to you”. This came before he confirmed there will be a further 2p reduction to the main rate of employees’ NI f rom 6 April 2024, taking it down from 10% to 8% for employed individuals. With a change date of 6 April 2024, this is a very short turnaround time for software developers to implement changes, which will impact almost all employed individuals throughout the UK. Payroll professionals will also be required to test any changes to e nsure they’re working properly and so they can meet their key remit of paying people accurately and on time. The CIPP heard from Jim Harra, Chief Executive and First Permanent Secretary, HMRC, last week at HMRC’s Stakeholder Conference, where he thanked payroll software developers and employers for implementing short notice changes to NI in January 2024. There’s a sense that the payroll industry are the key enablers for such changes, impacting so many people, by putting more money in their back pockets. This is a welcome change to employees, who will see a two-percentage point decrease in their NI contributions, hopefully easing the impact of the current cost-of-living crisis. However, any employee who uses a salary sacrifice arrangement for pension contributions, childcare vouchers, cycle to work schemes or ultra-low emission vehicles, will lose out on the associated NI savings.
The CIPP recommends employers use payslip messaging in April if they wish to advise employees on the reduction in the amount of NI contributions on their payslip, potentially resulting in an increase to their gross pay.
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High Income Child Benefit Charge (HICBC) threshold increased Published: 6 March 2024 Emailed: 13 March 2024
Jeremy Hunt announced that the government intends to radically reform the HICBC from April 2026. However, this will require significant legislative effort to achieve. The system will eventually move to a household income test for eligibility and will require HM Revenue and Customs (HMRC) to collect additional information to achieve this.
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