in Payroll, Pensions & Reward PROFESSI NAL Issue 61 June 2020 Official publication of The Chartered Institute of Payroll Professionals
Project management
Managing a remote workforce Methods and tips
Being payroll CIPPmembership
The future of payroll Visualisation
CIPP UPDATE | POLICY HUB | PERSONAL DEVELOPMENT
40 YEARS OF LEADING THE PROFESSION
INTEGRATED Human Resources, Payroll and Talent Management In-house or Cloud you choose
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“No one is actually dead until the ripples they cause in the world die away.” Sir Terry Pratchett (1948–2015) (https://bit.ly/2ZkocUh)
It was with much sadness I learned late in the preparations for this issue of Professional of the death of industry
professionals. It was created quickly, so it is unsurprising that the rules have been subject to almost continuous ‘clarification’. See page 30 for an example of an unintended consequence.
luminary Norman Green (page 5). I first met Norman in the early 1990s when attending
meetings of the Payroll Specialist Group. It was always a pleasure to meet and chat with him at the CIPP’s Annual Conferences. I, and many others in the industry, will miss him. The job retention scheme continues to be a challenge for payroll
Mike Nicholas MCIPP AMBCS (editor@cipp.org.uk) Editor
Chair’s message
Project management is a discipline and an approach to business that is so much wider than the title itself. If you consider a software project – perhaps a change in vendor – there is much more to the successful
it should be viewed as critical to the success of the department and business and typically must involve all departments that are invested in its success. Often projects must overcome immense hurdles to be delivered and only considered a success following a period of review and reflection. The Channel Tunnel, for example, is a magnificent technical achievement that did not generate enough customer interest to secure its financial future. The project overcame the most extraordinary hurdles, yet was it commissioned because it could be or because it should have been? Many businesses have lots of much smaller projects running than the example above, and if you have any opportunity to work on a project, I encourage you to jump in with both feet. Learning the disciplines of good project management will be a tool you can use in many opportunities yet to come. I hope you enjoy all the articles contained in this issue.
delivery than the installation of the software. It is a full-blown change programme and that involves the key pillars of strategy, culture, behaviour, process and upskilling before you even get to the software. All of which may touch every person in the business and perhaps beyond that with third parties and communications with banks as an example of changes to routines and outputs. In my experience, for any project to be successful those involved in the project must work hard to ensure there is a clear understanding of what the current position is, and what the future position post project implementation should look like. Timelines, resources, approach and impact must all be planned and signed off with the executive. Stakeholder management and buy-in from the senior team is incredibly important for successful outcomes as is engagement with all the business areas affected. Poor projects are often seen as ‘them and us’ – the project should not have a life of its own,
Jason Davenport MCIPP MIoD (jason.davenport3@cipp.org.uk) Chair, CIPP
We are living in unprecedented times and firstly my thoughts in this message are that you, your family and colleagues are well and in good health. Who would have thought payroll CEO’s message
Crucial to our success were dedicated teams supporting colleagues, delivered (like many of you) from a home environment with children and partners vying for attention during this lockdown period. New skills and concerns during this time in ensuring the well-being and mental health of all became a particular new phenomenon with ‘virtual’ coffee mornings, quizzes and the like just to have a feeling of ‘company’, community and a chance to interact; all of which became part of our routine. All who work in payroll should be proud of the part that they play keeping the UK paid, consistently meeting deadlines ensuring in these unique times that your people are paid accurately and on time. I know you will take personal satisfaction from that, as a job well done (again), and hope that delivers a message in your organisation to the strategic importance of the payroll function.
professionals would be working on the government’s Coronavirus Job Retention Scheme, discussing ‘furlough’ – indeed, who had even heard that expression until recently? And payroll staff being viewed as ‘essential workers’!? Well, we all knew that anyway. Your Chartered Institute has continued to support the membership. My personal thanks go to the CIPP teams who, by the end of March, were all successfully working from home. Our teams were engaged at all levels: policy at the heart of government as rules were converted into solutions, with several iterations keeping us all on our toes; and our Advisory Service handling quadruple the number of calls usually received in a month. We were able to bring in additional resource to support our Advisory colleagues to ensure we could address members’ enquiries (see page 8 for details). We rapidly converted all of our training courses, education support to students and national forums to online solutions.
Ken Pullar FCIPP (ken.pullar@cipp.org.uk) Chief executive officer, CIPP
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| Professional in Payroll, Pensions and Reward |
Issue 61 | June 2020
in Payroll, Pensions & Reward PROFESSI NAL
Also available online at payrollpensionsandreward.org.uk
Contents
June 2020
THIS ISSUE’S FEATURE TOPIC IS PROJECTMANAGEMENT
35 Thoughts on project management by Gary Chamberlin
Features
16
13
22
Project management by Jerome Smail
The power of the payslip by Steven Watmore
The future of payroll by Ian Hodson MSc ChMCIPPdip
23
26
28
Written statement of particulars by CIPP’s policy and research team
Holiday entitlement and pay by Lora Murphy ACIPP
C-19, and employment taxes challenges by Sudeep Ganguli
| Professional in Payroll, Pensions and Reward | June 2020 | Issue 61 2
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Chief executive officer Ken Pullar FCIPP CIPP board of directors Jason Davenport MCIPP MIoD Stuart Hall MCIPPdip Dianne Hoodless MSc ChFCIPP FHEA Editor Mike Nicholas 0121 712 1000 | editor@cipp.org.uk Advertising Jill Bonehill 0121 712 1033 | advertising@cipp.org.uk Design James Bartlett, Nicole Davis and Sam Parkes design@cipp.org.uk Printing Warwick Printing Company Ltd
Company cars – simply taxing by Samantha Mann MCIPPdip MAAT
CJRS and insolvency by Blair Adams
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38
Employers face pensions challenges by Steve Watson
We are all data scientists now by Henry Tapper
40
42
Liz Lay MSc FCIPPdip Carole Pearson MCIPP Katie Sharpe ACIPPdip
Cliff Vidgeon BA (Hons) FCIPP CMA ACIS Clare Warrington MSc FCIPPdip AFHEA
Deductions, vicarious liability, discrimination by Nicola Mullineux
Useful contacts
Annual leave and C-19 by Danny Done
Membership membership@cipp.org.uk 0121 712 1073 Education education@cipp.org.uk 0121 712 1023 Training admin@cipp.org.uk 0121 712 1063 Events events@cipp.org.uk 0121 712 1013 Marketing and sales marketing@cipp.org.uk 0121 712 1033 General enquiries enquiries@cipp.org.uk 0121 712 1000
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46
Delivering better employee communications with your payroll software by Glyn King
Managing a remote workforce by Helen Livesey
Regulars
03 Editor’s comment, and
21 Events horizon 22 Compliance 37 Reward 44 Industry news 45 Technology Additional online content 36 Age is just a number 37 Helping employees retiring
Chair’s andCEO’smessage Events, news and developments
04 CIPPupdate 05 We’ve got mail 06 My CIPP
cipp.org.uk @CIPP_UK
Articles Please support this magazine so that it can continue to be a part of your membership package. Trademarks The CIPP logo, the initials ‘CIPP’ and the words ‘Professional in Payroll, Pensions and Reward’ and ‘CIPP Consult’ are trademarks of the Chartered Institute of Payroll Professionals. Copyright: The Chartered Institute of Payroll Professionals 2020. The Chartered Institute of Payroll Professionals, CIPP, Goldfinger House, 245 Cranmore Boulevard, Shirley, Solihull, West Midlands, B90 4ZL. Switchboard 0121 712 1000 Fax 0121 712 1001 Copyright This magazine is published by The Chartered Institute of Payroll Professionals in whom the copyright is vested. All rights reserved. No part of this publication may be reproduced, stored in a retreival system, or transmitted in any form or any means, electronic, mechanical, photocopying, recording or otherwise, without the prior written permission of the publisher. The views expressed in this publication are not necessarily those of the CIPP or the editor. The information and comment contained in this publication are given in good faith, their accuracy or completeness cannot be guaranteed.
Membership benefits, Being payroll, Policy hub: On your behalf, and Advisory
12 COVID-19 news 13 Personal development Diary of a student 20 Payroll news
Full issue including additional online content available at payrollpensionsandreward.org.uk
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| Professional in Payroll, Pensions and Reward |
Issue 61 | June 2020
CIPP update
Celebrating 40 years of supporting payroll professionals THIS MONTH’S celebration of the profession cannot go by without recognising the work of payroll professionals throughout the period of March, April and May 2020. Never in the CIPP’s forty years have payroll professionals had to implement a scheme with such little notice, and such regularly changing guidance. You truly have been the unsung heroes of the COVID-19 pandemic. In recognition of this, and because it seemed inappropriate to focus on achievements of the past forty years supporting payroll professionals, we celebrate instead payroll professionals of the hour. To gain further recognition for the profession, the CIPP has written to central government outlining the work that you have done to keep the UK paid over the last few months. We shall ensure that this central theme – keeping the UK paid – remains through the National Payroll Week celebrations during 7–11 September 2020. The first National Payroll Week took place during September 1998 with the support of Tony Blair, prime minister. We hope to gain the support of the current prime minister, Boris Johnson, for what will be the 23rd National Payroll Week in the UK. At the time of writing the government has announced extension of the Coronavirus Job Retention Scheme (CJRS) beyond the end of June. We are awaiting further details of what changes to the CJRS rules will emerge in the coming weeks and indeed what else is in store for the UK or the payroll profession supporting UK employees. We will keep you updated via our coronavirus hub at https://www.cipp.org.uk/c19 . So, all that is left to say is ‘thank you and stay safe’.
Congratulations to our newly accredited PAS organisation
The CIPP welcomes new marketing manager EARLY IN May, the CIPP welcomed Joanne (Jo) Hudson BA (hons) to the team as the newly appointed marketing manager. Jo joins the Chartered Institute from Birmingham City University, where she has successfully developed and led marketing campaigns to attract new and young students to the university. Jo, who is qualified with the Chartered Institute of Marketing, brings experience from the university sector to support the CIPP’s ambitions to grow membership and student numbers, specifically aimed at attracting a younger audience and demographic.
The CIPP launches four online learning modules THE CHARTERED Institute is delighted to announce the launch of the following four online learning modules: ● Calculating National Insurance Contributions ● Calculating Income Tax ● Paying Statutory Sick Pay ● Paying Statutory Maternity Pay These online learning modules, which are delivered completely online, have been developed to support those who are completely new to payroll. Each course consists of a one-hour e-learning module within Moodle to provide a basic understanding. For more information, visit cipp.org.uk/online . THE CIPP Payroll Assurance Scheme (PAS) is designed to test your payroll processes in relation to payroll processing, compliance and the people skills and development opportunities. One of the most important elements is ensuring business continuity plans are in place and effective should they be required. Given recent events, congratulations to all organisations that have achieved this accreditation and will have been able to put those plans into action. Special congratulations to Dataplan on their Payroll Assurance Scheme accreditation. Ken Pullar, CIPP chief executive officer, said: “Never has it been more important for businesses to have good payroll processes, knowledge and skills that enable them to implement new government legislation and guidance quickly. Congratulations to those organisations that have recently demonstrated just that.” The Payroll Assurance Scheme is still operating, with assessments currently operating online. To find out how the Payroll Assurance Scheme can benefit your organisation, email compliance@cipp.org.uk .
| Professional in Payroll, Pensions and Reward | June 2020 | Issue 61 4
We’ve got mail
I am responding to the invite to get in touch regarding the history of the CIPP and also to offer some anecdotes prompted by the articles ‘When I was young’. In the early 1980s, I was working
Society is situated in Vincent Square, which is a busy area, adjacent to a large school. On the day of the exams there would be heard regularly and loudly from the direction of the school, the sound of a bell noting the start and finish times of lessons and break times. On top of that, roadworks were taking place outside, and the sound of pneumatic drills were heard intermittently all day. How any of us passed the exam is a wonder! The student of the year in 1985 was Val Hunt, who I had sat next to in the exam room. I swear to this day that Val copied my examination paper and that her success was down to me! Because Val also worked in a local authority, our paths have crossed many times over the years, and we are still friends to date. Having a professional body has raised the profile of payroll and pension professionals to the level they deserve. Gaining Chartered status was a huge achievement. Membership of the professional body certainly helped me greatly in my career, and I would urge everyone in the profession to become a member and take advantage of all the benefits available including the excellent training on offer. I have been speaking to a couple of ex-colleagues and it looks like payroll and pensions professionals have stepped up to the plate yet again in these worrying times. Unsung heroes! It is fantastic that the CIPP is carrying the torch for payroll and pension professionals – so please keep up the good work.
for a local authority and being pushed down the accountancy route. I decided, after passing my AAT examinations, that accountancy was not for me. I applied for a job in a neighbouring authority as a senior payroll administrator … and was very surprised to get it. I really enjoyed the payroll work especially dealing with the weekly payroll where the staff were paid in cash. After the payroll was run, and the coin analysis produced, my boss and I would walk across the High Street to the local bank and pick up the cash and bring it back in an Adidas sports bag. How we were not ever mugged I will never know! The staff used to come in on a Friday to pick up their wage packets from a secure room in the Town Hall. It was great to put names to faces. I joined APSA (Association of Payroll and Superannuation Administrators) as soon as possible and was one of the inaugural students for obtaining the full qualification. It was all done by correspondence, and I had great tutors for the various subjects including pensions which became my great love. I remember vividly going to take our finals exam at the Royal Horticultural Society, London in 1985. The Royal Horticultural
Phillip Reynolds MCIPP
Vickie Graham DipM ACIM, CIPP business development director: Thank you Phillip so much for your submission and giving some insight into the early days of the Institute. These are ‘interesting’ times to say the least and it is amazing to hear tales of handing out cash and meeting face to face when these are things we are no longer encouraged to do.
Norman Green BSc FBCS CEng CITP FCIPP 7 July 1950–13 May 2020 Norman was a much-loved member of the payroll community and worked with the CIPP supporting students through their qualifications since 1994. Having started his career as a programmer at Kent County Council, Norman held various roles and positions within the profession. He spent 35 years of his career working for CGI (previously Logica) from 1981, where he finished his career as legislation and compliance manager in 2016. In addition to his full-time employment, Norman was committed to developing professionals within the industry and was employed as a tutor on the CIPP’s Foundation Degree in Payroll Management (previously the Diploma in Payroll Management). Throughout his many years of service, Norman provided support, guidance, and advice to the many students he had steered through our qualifications, as well as members of the CIPP board. In addition to the work that Norman did for the qualifications
team, Norman was an invaluable support to the CIPP’s policy team over the years, providing them with updates, putting forward members’ views and attending consultations on behalf of the CIPP where
it had not been possible for us to attend. Norman also held the position of vice-chair of the payroll group for BCS from September 2013. He was highly regarded by HMRC and other government departments and agencies, as well as by all of us at the CIPP where he would act as a sounding board for early policy development and providing a technical insight into requirements of payroll software. The payroll industry has benefitted enormously as a result of Norman’s input, experience and influence over the years. The profession would not be what it is today had he not been part of it. Rest in peace, Norman.
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| Professional in Payroll, Pensions and Reward |
Issue 61 | June 2020
MY CIPP
As amember of the CIPP there are loads of benefits available to you to ensure you stand out in the crowd. Whether that be your workplace or the industry as a whole, make sure you excel by using the tools and services available. Your membership benefits
Be supported, be supportive Be part of a community where you can collaborate with, share, learn from and support other professionals. This has been particularly important in recent times. ● The CIPP’s Advisory Service – Accessed by email, phone and online, the highly experienced team are up to date with what’s happening in the industry and will support you with your technical queries. ● Specialist interest groups – Available via MyCIPP, these groups are easy to join and provide a communications platform for like-minded professionals in your sector. ● Annual benchmarking exercise – This is included for full, fellow and Chartered members enabling you to compare your payroll with other participants. Results are completely anonymous and will help with project managing strategic business plans and decisions. Be knowledgeable Stay up to date, solve problems and save time with our knowledge resources. We know, because you told us, that you are a member to keep up to date and we have a vast array of resources available to enable you to do just that, including: ● Events – For associate level and above we run national forums which this year, due to government restrictions, are all being run virtually. If you are an affiliate you can book a place on the virtual payroll and reward updates. However, if you want to attend an industry leading event, consider booking the National Payroll Conference, Edinburgh Scotland in September or the CIPP’s Annual Conference and Exhibition, Newport Wales in October. Both of which will provide excellent opportunities for education, collaboration and celebration.
● Payroll: need to know – your guide to UK payroll legislation and reporting – This frequently maintained and updated resource provides an indexed summary of news and links to payroll, pensions and employment legislation. The CIPP’s policy and research team issue an updated guide fortnightly so you can be assured that you have the most up to date information to hand. ● The Compact Payroll Reference Book – Known as the ‘Payroll Bible’, this annual book has been updated recently with everything you need for the 2020-21 tax year. Associate, full, fellow and Chartered members are sent the book, as part of the tax pack, following the start of the new tax year. This includes other useful tools such as: ❍ CIPP payroll factcard ❍ CIPP payroll fact pen ❍ CIPP wall planner. If you are an affiliate member and are interested in receiving a tax pack, visit MyCIPP or contact membership@cipp.org.uk to upgrade your membership. ● Policy webcasts – The CIPP’s policy and research team release updates on topical issues relating to legislation changes, such as Coronavirus support measures and a Budget update, and how these affect payroll professionals. These are available at any time and can be accessed through MyCIPP. Be recognised Let your colleagues, employer, customers and clients know that you are part of the only Chartered body for the payroll profession. Tell them how this sets you apart from others because you have the CIPP supporting and informing you which non-members do not have. Use your designatory letters on social media, business cards and your email
signature. Display your membership certificate with pride and use your voice to let the CIPP’s policy and research team represent you at government consultation forums. And, for associate levels and above, have your say at the Annual General Meeting, either to vote for your chosen candidate or even consider standing yourself. Be developed Take advantage of the vast opportunities and our professional development resources to grow your career, develop your team or grow your business. Members of the CIPP can benefit from: ● Online Continuing Professional Development (CPD) logging tool, enabling you to log your learning objectives and progress towards achieving these throughout your membership year ● 50% off our payroll and HR legislation update and calculating a payslip training courses ● £100 off our other training courses including blending learning ● Special offers including: Reward Strategy reduced price membership and discount on contract, temporary and permanent recruitment with Portfolio Payroll. Consider where are you in your career and if your level of membership reflects this. Make sure that you use the benefits and tools available to you and let us know if you think of other things that would benefit our other members. n To see your current level visit MyCIPP and use the opportunity to consider upgrading to the next professional level. The team are always happy to help and you can contact them at membership@ cipp.org.uk .
Our membership grades
CHARTERED FELLOW
FELLOW
CHARTERED FULL
FULL
ASSOCIATE
AFFILIATE
| Professional in Payroll, Pensions and Reward | June 2020 | Issue 61 6
My CIPP
Being payroll
# Be Payroll
Daniel HancockMSc ChFCIPPdip, payroll manager, DFDS Seaways Plc , discusses the benefits of being part of the CIPP
Why did you become a member of the CIPP? I had been working in payroll for ten years and hadn’t got any qualifications and started searching on the internet for a training provider or a recognised company and IPP (CIPP as it is now) was the first name that came up in the results. It did the sort of training and qualifications I wanted to achieve and allowed me to do distance learning which fitted in with my full-time job. Which benefits of CIPP membership appealed to you the most? I think it’s partially the recognition of being part of a large organisation. It works in your favour when businesses are looking for what sort of status you’ve got. It is also the training opportunities that are offered. How has the CIPP membership helped you in your career? I have the Diploma in Payroll via distance learning and also the MSc in Business and Payroll Management, as they were named
then, which were both three-year courses. They have enhanced me as an individual doing my day to day job. They have allowed me to secure a new position as payroll manager for UK and Ireland. As a member you always have the Advisory Service as back up. Tell us about a time when you or your department benefited from CIPP membership We have used the CIPP’s in-house payroll training. We found that very useful especially for sensitive topics or more in-depth subjects relevant to our business. We were able to make the courses bespoke to us and look into more individual problems that couldn’t be done in a public session.
Tell us about the day you realised that CIPP membership was of real value to you
I was quite happily working for the same employer for ten years and then one day I was made redundant. It wasn’t until then, when I was looking for a new job, that I realised that every employer was asking for people with, or working towards, a CIPP qualification. By being a qualified member, it put my CV further up the list than other applicants. For someone who is thinking about joining as a member, what would be your advice to them? I would definitely recommend joining CIPP because it provides the Advisory Service and the opportunity to network. As well as offering various different training opportunities and ad hoc courses. Why was it important for you to become a Chartered member? I felt that having been in payroll for nearly thirty years, with the highest level of qualifications, I wanted to strive to attain the highest level of membership. As well as keeping me on par with my peers in finance and human resources functions.
If you would like to be part of the being payroll series, please email info@cipp.org.uk
BE PROFESSIONAL. BE COMPLIANT. BE RELIABLE. BE VERSATILE. BE PASSIONATE. BE PAYROLL.
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Issue 61 | June 2020
| Professional in Payroll, Pensions and Reward |
MY CIPP
Policy team update On your behalf
The CIPP’s policy and research teamprovides an update on developments
Coronavirus The CIPP’s policy and research team regularly post topical questions on the CIPP’s News Online pages in the form of quick polls, in order to gain an insight into the views of payroll professionals on the issues that are impacting them most at any given time. It would be strange therefore in current circumstances to omit reference to the outbreak of COVID-19. So, unsurprisingly, several of our quick polls have asked questions regarding the effect on payroll departments in the UK of measures implemented by the government to help businesses and individuals through the outbreak. One of the questions posed asked: “Which of the COVID-19 measures is currently challenging you the most?” This prompted more than 3,000 responses in a two-week period, thereby clearly demonstrating how heavily the payroll profession has been affected by the coronavirus crisis. The results for this quick poll are as follows: ● Furlough: 40% ● Self-employed income support scheme: 24% ● Coronavirus Job Retention Scheme (CJRS): 20%
through the Coronavirus Job Retention Scheme easy to do?” The responses are as follows: ● Yes, as an employer: 41% ● Yes, as an agent: 27% ● No, as an employer: 20% ● No, as an agent: 12%. The near-continual publication of improved employer (and employee) guidance on GOV.UK relating to the CJRS has dominated much of the policy and research team’s work over the past six weeks, as every iteration of guidance brought numerous new questions and challenges which hadn’t previously been considered. The team, along with other key stakeholders, has been in almost constant contact with HM Revenue & Customs (HMRC) in a bid to present the questions raised by members in order to obtain answers, and to support the profession through these unprecedented times. The team has also produced a CJRS FAQs (frequently asked questions) page and an early webcast on the topic. The increased demand has not only impacted the policy and research team but has also permeated through to many other areas of the CIPP’s business, with particular effect on the Advisory team. A glance at the statistics for March and April and comparison with 2019 reveals the extent of how busy the Advisory Service team has been. This year they handled 1,403 queries in March and, at the time of writing (27 April 2020), a staggering
1,789 in April. The figures in the same month last year (2019) were 1,032 in March and 776 in April. The CIPP has continued to serve its membership, despite the coronavirus outbreak, and will continue to do so. Please keep submitting your questions and experiences. IR35 reforms Though the government’s response to the coronavirus crisis has included creation of a range of new measures to help support businesses through the outbreak, there has been an impact on other pre-existing policies. A key example of this relates to the extension of the off-payroll working reforms to the private and third sectors which were originally scheduled to be introduced in April 2020 but are postponed due to the crisis, and will now take effect from 6 April 2021. The CIPP, as a member of the IR35 forums, was involved in a short one-off meeting which provided stakeholders with an update on the work of the team. The clauses have been temporarily removed from the current Finance Bill but will be brought back ahead of the new implementation date of the reforms in April 2021. There was also a brief question and answer session in relation to coronavirus. Following the retirement of Rowena Fletcher, the IR35 forum has a new HMRC chair. We wish Rowena a long and happy retirement, and welcome Christopher Simon who joins Samantha Hurley of APSCO as co-chairs of the forum. The House of Lords economic affairs finance bill sub-committee’s report, Off-
● Statutory sick pay: 9% ● Other measures: 5% ● Pay attachments: 2%.
Following the launch of the CJRS reclaim portal opening we asked: “Have you found submitting a claim
...every iteration of guidance brought numerous new questions and challenges which hadn’t previously been considered
| Professional in Payroll, Pensions and Reward | June 2020 | Issue 61 8
*please see summary at cippmembership.org.uk for details.
Policy hub
payroll working: treating people fairly , reviewed the reforms to off-payroll working and can be located here: http://ow.ly/ VlOx30qBqVe. Although welcoming the delay to the reforms, the sub-committee implores the government to use the additional time to ‘completely rethink’ the legislation. This would be an ambitious task in the short time available to April 2021; could we see another delay? Prior to the outbreak of coronavirus, the CIPP posed a quick poll question to ask: “What concerns do you have about your readiness in April 2020 for off-payroll working rules?” The responses are as follows: ● Payroll obligations: 35% ● Status determinations: 30% ...the potential for employers or others involved in tax administration to be involved in the process...
● Internal processes: 19% ● Transfer of liability: 6%
which sought to find ways to simplify the administration of certain claims and elections, paying particular attention to those made by employees, the self- employed and businesses in relation to income tax, corporation tax, capital gains tax and VAT (value added tax). The consultation was published because claims and elections are a vital part of the operation of the tax system. Frequently, claims are required for a wide variety of reliefs that are available for taxpayers, in relation to many taxes; for example, employees claiming work- related expenses such as for cleaning their working uniform. This call for evidence poses many questions, one of which considers the process “in relation to any reliefs or exemptions being applied automatically, the potential for employers or others involved in tax administration to be involved in the process, including supplying information to HMRC”. At the time of writing we are working with the OTS to put together a brief survey to gather members’ views on this idea. n
● Communications with contractor: 6% ● Communications with the supply chain: 4%. It is crucial to remember that there is only a delay to the implementation of the reforms. They will still go ahead – subject to the government’s response to the report – so preparedness for these reforms continues to be a priority in the coming months.
Claims and elections consultation It is important to remember that despite the situation with the coronavirus pandemic there are still ‘business as usual’ items that need to be addressed. The Office of Tax Simplification (OTS) published a call for evidence
NEWTO PAYROLL? BOOST YOUR SKILLS IN AN HOUR New one hour
Calculating National Insurance Contributions
Paying Statutory Maternity Pay (SMP)
Calculating Statutory Sick Pay (SSP)
Calculating income tax
e-learning courses for only £75 +VAT
Book online at cipp.org.uk/training or email enquiries@cipp.org.uk for more information.
cipp.org.uk CIPP_UK @CI P_UK cipp.org.uk
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| Professional in Payroll, Pensions and Reward |
Issue 61 | June 2020
MY CIPP
The CIPP's Advisory Service team provides answers to popular questions
Q: An employee is due to take adoption leave through a surrogacy arrangement. Guidance on the GOV. UK website states that “proof is not needed for leave or pay unless you ask for it”. What sort of proof could be required? A: An employer can ask for a statutory declaration from the employee confirming that they intend to apply for a parental order under section 54 of the Human Fertilisation and Embryology Act 2008 within six months from birth and expect that order to be made. The notice must include the baby’s expected date of birth, and as soon as possible the employee must inform the employer of the actual birth date. You can find information here: https:// bit.ly/2zdU6qj. Please refer to pages 23 to 29 for specific information on surrogacy and parental order parents. Q: Where an employee has a company car which is changed part-way through the tax year how is this reported to HM Revenue & Customs (HMRC)? A: The employer can submit an electronic P46(Car) return. (This return does not remove the employer’s responsibility to make a P11D return for the company cars at the end of the tax year.) The employee can set up a personal tax account with HMRC which they can use to inform HMRC that they have changed their company car. Q: For the purpose of claiming employment allowance, is the National Insurance contributions (NICs) bill to use the total of the employee and the employer NICs for the previous tax year? A: It is the employer (secondary) NICs only, in the tax year before the claim is made, that you need to use. Also, if the company receives any de minimis state aid that will also affect for what you can
claim. Guidance on the GOV.UK website can be found at https://bit.ly/2YEJwn2.
free of income tax liability. A similar provision applies for NICs. The exemption is for household expenses connected to the employee’s home where they must perform their employment duties. The exempt amount is £4.00 per week in tax year 2019/20 which in tax year 2020/21 has increased to £6.00 per week. Q: Does a salary sacrifice arrangement reduce the amount of attachable pay where an attachment of earnings order (AEO) operates for an employee? A: The legislation governing the AEO defines which earnings are included when calculating attachable pay. A salary sacrifice arrangement reduces earnings. The employer is giving the employee a benefit instead of cash, and benefits are disregarded for determining attachable pay. Q: Due to the coronavirus crisis the company has decided to offer employees a loan of up to a maximum of £5,000 to be repaid over a twelve- month period. Would this be a reportable loan? A: As this amount is below £10,000 it would be considered a ‘small loan’ and therefore it would fall within section 180(1)(b) of ITEPA. As long as the employee repaid the loan (salary sacrifice cannot be used for the exemption to apply) from pay after PAYE and NICs have been calculated and deducted, then even if the repayment crosses tax years there will be no reportable duties or tax or class 1A NICs due. If the employee has another loan which takes them above £10,000 then there will be a reporting requirement and liability. Q: Can you please advise how as an agent I can become authorised to act online for my clients, so I can make claims under the Coronavirus Job Retention Scheme (CJRS) for them?
Q: One of our line managers wants to ensure their staff can get to work during the lockdown period by using taxis instead of public transport and wish to reimburse such costs. Would this create a taxable benefit? A: A journey the employee takes to travel to their normal place of work is treated as ordinary commuting. If the employer reimburses the employee for the costs of the taxis the amounts are subject to pay as you earn income tax (PAYE) and NICs through the payroll. If the employer pays an allowance this will also be subject to PAYE and NICs through the payroll. If the employer pays the taxi company, then it is a reportable benefit. The following link should be useful: https://bit.ly/3e0CI8z, as it explains what benefits are exempt due to coronavirus. Q: A client has decided to payroll benefits. Is there a deadline for applying to HMRC? A: Yes, an employer would have to register with HMRC that they were going to payroll expenses and benefits. They must do this before the start of the new tax year i.e. before 5 April of the year the benefit is provided. GOV.UK has information on what to do and how to register: http://bit.ly/2uL3egN. Q: Several employees who worked from home last year received from our employer £4.00 a week for household expenses. Was it correct not to subject these payments to PAYE or NICs? A: If the employees do not have a choice but are required to work from home by the employer then under sections 316A and 336 of the Income Tax (Earnings and Pension) Act 2003 (ITEPA) an exemption means they can receive a certain payment
The CIPP Advisory Service is available * 9a.m. to 5p.m. Mondays to Thursdays, and 9a.m. to 4.30p.m. on Fridays. Call 0121 712 1099 or email advisory.service@cipp.org.uk .
| Professional in Payroll, Pensions and Reward | June 2020 | Issue 61 10
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A: Where an agent is registered with HMRC but has not been authorised to act online for a client in PAYE, they can seek authorisation to be able to do so. A fast route to ensure the right permissions are in place rather than using paper form FBI2 or the online agent authorisation process, would be for the agent to ask their client to authorise them to act for PAYE through the client’s business tax account (BTA). The client will need to have enrolled for PAYE online for employers. The agent must also be enrolled for PAYE online services for agents and needs to give their agent Govern-ment Gateway ID to the client. To authorise the agent the client will sign into their online BTA (BTA) and action the following: ● Select ‘Manage Account’, and choose the ‘Add, view or change tax agent’ option under the heading ‘Tax Agents’. ● Select ‘PAYE for employers’ and click ‘continue’. ● On the ‘Manage who can access your taxes and schemes’ page, click the ‘Add an agent’ link next to the service to assign the agent for (e.g. PAYE). ● Enter the agent’s Government Gateway ID provided by the agent and click ‘continue’. ● Click on ‘Add Agent’ to confirm. Confirmation will be sent that the agent has been added. By having this authorisation in place, the agent can act for the client in all PAYE matters online, not just for the CJRS scheme. If authorisation was only intended to be used for CJRS claims, the client should advised to remove the agent access via the BTA once the claim is made. Q: During the coronavirus epidemic, several of our employees suspended their use of the childcare voucher scheme that we operate. All employees are back at work and now require the use of childcare. They have asked if we can reinstate their childcare voucher accounts and make deductions as they did prior to the suspension. Is this allowable? A: The key to whether this would be allowable will be dependent on the action taken when the deductions ceased. If the schemes were suspended and left open, then providing that deductions are made and vouchers are provided
within a twelve-month period from the last deduction, the employee will be able to continue to use the scheme and gain the tax relief attached to it. If the employee requested that the scheme be closed, then unfortunately they will not. From October 2018, legislation regarding childcare voucher schemes, advised that employees could not enter into a scheme after this date. If the employee chose to close the scheme at this point, then there would be no option to reinstate, regardless of time frame as the scheme is closed to them. Q: We are currently calculating if an employee would be eligible for statutory maternity pay (SMP). During the earnings reference period the employee was in receipt of furlough pay, which was 80% of her normal pay. When we look at the earnings figures, the earnings requirement will not be met. Is it correct to use what was actually paid or should we look at what she would have earned if she had not been furloughed? A: To qualify for SMP, the employee must have average weekly earnings (AWE) not less than the class 1 NICs lower earnings limit (LEL). The LEL to use depends on the expected date of birth. If the baby is due to be born on or after 19 July 2020, the AWE must not be less than £120 (or £118 if the due date is before 19 July). Typically, the earnings to be included in the AWE calculations are those treated as NICable pay (i.e. those subject to class 1 NICs) in the relevant period. However, revised guidance on GOV.UK refers to certain rules applying where the employee’s period of family-related statutory pay begins on or after 25 April 2020; see https://bit.ly/2xLy126. If the employee was on furlough and was paid with help from the CJRS during any part of the relevant period, there are different rules about how to work out their AWE. This is to ensure eligibility for SMP and the earnings-related rate are not affected if the employee’s wages are lower than normal because of being furloughed. The earnings to use for the part of the relevant period for which the employee was furloughed will be the higher of either what she actually received from her employer or would have received had she not been on furlough. n
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| Professional in Payroll, Pensions and Reward |
Issue 61 | June 2020
COVID-19 news
Organisations struggling with loss of payroll capacity ACCORDING TO a survey recently conducted by Zellis – a leading provider of payroll and human resources (HR) software and managed services to UK and Ireland-based companies – almost a third (30%) of organisations have lost payroll capacity due to pressure caused by the coronavirus pandemic. Payroll and HR decision makers from more than 150 organisations across the UK, Isle of Man, Channel Islands, and the Republic of Ireland that run payroll in-house were surveyed between 18 March and 14 April 2020.
Citing limited team sizes and remote working challenges, nearly half (44%) said they are not confident about their organisation’s ability to run its payroll function if staff members are directly affected by the virus. The vast majority (85%) said their organisation employs fewer than ten payroll staff members, while 15% said these employees do not have access to the infrastructure and resources needed to work at full capacity from home.
Managing short-term change was also highlighted as a major challenge, as 40% said that they are concerned about the complexity of adopting emergency government measures such as the UK’s Coronavirus Job Retention Scheme (or Ireland’s Temporary Wage Subsidy Scheme) and changes to sick pay. When asked how their organisation is responding to pressure, nearly two-thirds (64%) said they have either changed their payroll performance targets or deprioritised other work in order to focus on key tasks. Additionally, 15% said that they are running last month’s payroll as a contingency measure. However, this could cause issues as payroll values change over time, especially as a result of the need to process sick pay and reduced pay for furloughed workers. A third (32%) agreed that the outbreak will have some form of long-term impact on how their organisation runs its payroll and human resources (HR) operations. Nearly four in ten (39%) said their organisation will develop stronger business continuity plans to prepare for any future incidents, while a quarter (27%) will focus on accelerating the adoption of automation to reduce its dependency on manual work. John Petter, chief executive officer for Zellis, commented: “In these unprecedented times of major workforce disruption, it’s clear just how integral the payroll function is within any organisation. It plays an essential role in supporting the wellbeing of staff members, especially those who are ill, looking after loved ones, or furloughed. In managing complex and time-sensitive changes under significant pressure – sometimes without all of the right resources to hand – payroll teams could be considered unsung heroes during this extremely difficult period. “The designation of payroll staff as key workers will have helped to ease the pressure to some extent, but it isn’t a substitute for proper business continuity plans. At Zellis, we have already experienced a lot of demand for additional payroll support, especially regarding the government’s furlough scheme, and are doing everything we can to help.” Commenting on behalf of the CIPP, Vickie Graham, business development director, said: “It’s positive to see that 32% of respondents believe the coronavirus outbreak will have some form of long-term impact on their payroll and HR operations. It’s likely that this impact will include more flexible working arrangements, moving payroll to the cloud, and enabling a greater work-life balance. “The CIPP would also like to see an increase in succession planning and business continuity plans for payroll, so that those working within payroll departments are not as impacted should something like this happen again in the future. “I think that we can all agree that payroll professionals have become unsung heroes of the hour, working tirelessly and relentlessly to keep the UK paid. The CIPP will be lobbying government to recognise this work and the profession during and as we move out of this pandemic, to ensure that payroll professionals are given the recognition that they deserve.” Changes to CJRS THE UK government announced on 12 May that the Coronavirus Job Retention Scheme (CJRS) is extended to the end of October 2020, and that the subsidy for furloughed workers wages stays at 80%. However, from the start of August, furloughed workers will be able to return to work part-time with employers being asked to pay a percentage towards the salaries of their furloughed staff. The employer payments will substitute the contribution the government is currently making, ensuring that staff continue to receive 80% of their salary, up to £2,500 a month. More specific details and information around the implementation of the changes will be made available by the end of May. The government will also explore ways through which furloughed workers who wish to do additional training or learn new skills are supported during this period. As at 10 May, 935,000 employers had furloughed 7,500,000 workers, and the total amount claimed under the CJRS exceeded ten billion pounds.
CIPP coronavirus hub For the latest news, updates and resources from the Institute and others, visit the CIPP’s Coronavirus hub at cipp.org.uk/c19 .
| Professional in Payroll, Pensions and Reward | June 2020 | Issue 61 12
Feature topic - Project management
Project management
Jerome Smail, freelance journalist , presents the experiences and advice of several industry luminaries
T here are the day-to-day tasks that the profession takes care of – such as making sure everyone is paid the right amount at the right time, which is no mean feat in itself, as we know all too well. But from time to time there are special projects that need to be undertaken in addition to this – whether it’s implementing new systems, learning initiatives or overhauling processes to comply with new regulations. This calls for yet another string to the professional bow of payroll and reward professionals: project management. So, what are the most essential elements of successful project management? “Before committing to any project, you must first have absolute clarity on why you are doing it and what your must- haves are for the end result,” advises Jacki Hodgson, director of professional services for CoreHR. You must define and engage your
stakeholders early, says Hodgson. If they come along on the journey, they may well be able to help you and your team. Think about any relevant external stakeholders you need to engage – suppliers and their consulting teams, for example. Make sure, too, that you know your data sources. Where is it held at present? Is it already of good quality and complete? Is it held in an existing system as a single view or dotted around in multiple spreadsheets? And before you commit, be aware of the risks you could face and how you can mitigate them. Martyn Cheney, director of Cheney Payroll Services, recommends streamlining your processes so you will be more efficient and deliver a better project. “It can be easy to steer away from the end goal as different situations arise, but it’s important to always go back to your initial plan and review the aims and objectives set out at the start,” he says. “If a problem arises, find a solution but ensure that other elements
of the project are in hand too.” As the old saying goes, ‘fail to prepare, prepare to fail’. Jason Davenport, CIPP chair, insists that “involving the right people at the right time for the right reasons to deliver a quality approach translates to planning, planning, planning”. He adds: “Successful projects that are well-managed and given the appropriate amount of time to deliver, as well as using time available efficiently, have much more chance of being successful.” When the resources available become reduced, or the time available is shrank, or the testing is not given due diligence, then there is every chance of risk increasing and the overall project delivery being less successful, says Davenport. The early stages of a project can be considered the ‘honeymoon period’ – with lots of time available to get to understand the expectations and outcomes due. “This time must be used for expansive research and ensuring all stakeholders are fully engaged,” he says. “If questions aren’t asked and answered at this stage, it risks the delivery at the end of the project.” A project should also be integrated into the business it is serving, not stand
...have absolute clarity on why you are doing it and what your must-haves are for the end result
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| Professional in Payroll, Pensions and Reward |
Issue 61 | June 2020
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