by Michelle Bourne | Nov 29, 2017 | national insurance, PAYE, Personal Allowance
So the Chancellor has raised the Higher Rate income tax personal allowance threshold from £45K to £46,350 from April 2018, and the Lower Rate Threshold will increase by £350 to £11,850.
This means that the new tax codes will increase from 1150L to 1185L in April 2018.
For a typical worker who pays tax in 2018-9, this will be a £1075 reduction in their tax paid, and a Full time Worker who is on the National Living Wage will take home more than £3,800 extra in their wage packet.
But is this good news for the typical worker? Well, the increase in personal allowance may be less generous than you think, since at just over 3%, it was only just in line with inflation!
Given that National Insurance is payable at a rate which is more than £3K below that of income tax, the lowest paid taxpayers may query whether the increase in personal allowance is the right way to support them?
Let me know your thoughts!
by siteadmin | Nov 16, 2016 | PAYE, statutory maternity pay
Because of the struggle involved in balancing business needs and support for working parents, maternity and childcare issues are often in the press.
Proposals to extend statutory maternity pay were recently put forward, from the current 39 weeks to 52 weeks, and to provide 15 hours of free childcare a week for children aged one to four years old.
The idea behind these proposals is to improve incomes and job prospects for working parents, which is often a struggle for employees who are juggling childcare and career progression.
It is not sure whether this will develop into government policy but with a hefty £2 billion price tag, it is certainly a radical idea which will carry pros and cons for both employers and employees.
The positives can be:
- Improved morale for working parents. They should feel more supported by their employer
- Improved reputation for the organisation in its approach to working families. Many job candidates like to see a company demonstrating empathy and support towards its employees
- Less stress for employees planning a family from a financial/career progression perspective. If women know they will receive extended maternity pay, and free childcare, earlier on they will worry less about the financial impact of becoming a parent, and hopefully discard the idea of not returning to work
- Women will be less likely to allow starting a family to affect their career plans
But there also may be negatives:
- Organisations could face workforce planning issues if more women take the full 52 weeks’ maternity leave
- Employees without children could argue they were being disadvantaged because they do not have them
- There may be an increase in pregnancy/maternity discrimination towards those employees benefiting from the increase in statutory maternity pay and free childcare
Out of these, the potential rise in discrimination claims is perhaps the most worrying for an employer as this could be potentially very costly. If this happens then it might be necessary to carry out refresher training on a wide range of equality issues.
Organisations would need to expressly state that all employees should be treated fairly and equally, regardless of their personal life choices, including whether or not to have a family.
Having a checklist to go through with employees before they go off on maternity leave, would be a good idea and should include:
- Confirmation of maternity leave dates
- Clarity on whether the employee will be accessing work emails during leave
- Confirmation from the employee on how she would prefer to be contacted during maternity leave
- Up-to-date phone, email and postal contact details for the employee
- A section that can be signed by the employer and employee to indicate that both parties have agreed to the arrangements
by siteadmin | Sep 14, 2016 | PAYE
Over half a million company car drivers face increased tax bills under a proposed crackdown on valuable perks by the Treasury.
Salary sacrifice schemes allow employees to exchange some of their taxable pay for benefits, such as company cars and phones. It cuts down the employees tax and National Insurance bill each month, and employers end up paying less National Insurance for the employee.
The proposed rules could come in to play as soon as April 2017. Under the proposed new plans, workers would be taxed on the full amount of salary sacrificed, meaning there would be little point in having a salary sacrifice scheme in place.
Only a few benefits will be excluded from the plan, notably pensions saving, childcare and cycling safety equipment.
The crackdown will also include other benefits, such as gym memberships and car parking spaces.
The Treasury said that the proposal does not prevent employers from providing benefits in kind to their employees through salary sacrifice, but it will remove the tax and NICs advantages that come from doing so.
by siteadmin | Aug 17, 2016 | PAYE
Here at Quickpaye we are always keeping up with current updates, so Michelle has done some more Auto Enrolment training this week.
We are all geared up for this and can set you up online with a pension scheme, and then run all the administration work for you in conjunction with your payroll.
This means that there will be very little or nothing for you to do, and the words AUTO ENROLMENT are no longer something to ignore or run away from!
Call us or email us now, we can help you with this! (more…)
