Follow this link to view the new rates:

http://www.onlinepayrolls.co.uk/downloads/rates-limits/

The National Insurance Holiday scheme is for new businesses which start up between 22^nd June 2010 and 5^th September 2013, who are based in certain regions of the U.K. (Not London, South East or Eastern England).  It means that you don’t have to pay up to £5000 of employer’s National Insurance for each of the first 10 employees you take on within 12 months of starting the business, meaning a maximum saving of £50,000.

Types of business that can apply:

The types of business that may be able to apply for the holiday are:

• a sole trader, company or partnership that begins to carry on a trade, profession or vocation
• a property business or investment business
• a new trading charity whether or not it is carrying out activities with a view to profit

Managed Service Companies do not qualify for the holiday.

If you are a client of Online Payrolls, we will help you with the administration of the scheme and keep the necessary records for you as part of your payroll service.

For more information and details on how to apply, click here:

The main (adult) rate applies to workers aged 21 and over, and will increase to £6.08 per hour.

The NMW development rate applies to 18 to 20-year-olds and will increase to £4.98 per hour.

The 16 to 17 rate applies to workers above school leaving age but under 18, this rate will be £3.68 per hour.

The apprentice rate is for apprentices under 19, or over 19 and in the first year of their apprenticeship. This rate will be £2.60 per hour.

The above rates are likely to be in force until October 2012.

Under current arrangements, employers who participate in the Cycle to Work Scheme can use the cost of the bicycle and accessories NET of VAT to be deducted from the employee under a salary sacrifice agreement.  For all cycles purchased through the scheme after 1^st January 2012, the employer will have to use the amount including VAT.

Example of savings up to 31 December 2011

Cost of bicycle:                                                 £500

Cost of accessories                                         £100

Total cost                                                        £600

Deduct VAT reclaimable by the business:      (£100)

Amount to be deducted from employee:          £500

This is deducted from the employee over either 12 or 18 months before tax and NIC is calculated, therefore an employee paying basic rate tax would save 20% Tax and 12% National Insurance, a total of £160.00.  The cost to employee for the original £600 value is therefore £340.00.

For employees paying the 40% or 50% tax rate, the savings will be even higher.

Example of savings after 1 January 2012

Cost of bicycle:                                                £500

Cost of accessories                                         £100

Total cost                                                         £600

This is deducted from the employee over either 12 or 18 months before tax and NIC is calculated, therefore an employee paying basic rate tax would save 20% Tax and 12% National Insurance, a total of £192.00.  The cost to employee for the original £600 value is therefore £408.00.

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Please note:

1) The employer is the owner of the bicycle until the end of the salary sacrifice term, at which point the employee can choose to pay a small sum to use the cycle for an extended period, and can then purchase it for an amount according to a sliding scale set by HMRC.

2) Some employers, such as charities and some public sector employers may not be able to reclaim the VAT.

Please get in touch with us if you would like any further information regarding the scheme.

Remember that Online Payrolls do not charge for setting up the salary sacrifice deductions on the payroll or for extra reporting requirements for our clients.

Eligible workers are those who earn at least the minimum earnings threshold (currently £7475 per annum), are between 22 years old and state pension age, and who work in the U.K.

Employees will have the choice to opt out of the scheme if they wish, but it is a criminal offence for employers to coerce their workers to opt out.

The minimum contribution that is allowed to be paid into the pension will be 8%, which will be made up of the minimum employer contribution of 3%, employee contribution of 4% and tax relief of approx 1%.

If you have an existing pension scheme you may use this instead of setting up a new one, but you must check with your pension provider to ensure it will fulfil your legal obligations under the new law.   

To find out more, view the following information leaflets:

Workplace Pension Law is changing

Introduction to workplace pension changes

Or visit www.thepensionsregulator.gov.uk

The above list is not comprehensive, the items shown are examples of SOME of the items which must be reported.

If you would like us to prepare your P11Ds for you, or have any questions as to whether you need to complete P11Ds or if certain items need to be included, please get in touch with us for further advice.

Our comprehensive P11D software will email P11Ds and summary benefit reports to the employer, email P11Ds to employees, provide Class 1 NIC calculation reports by department, and submit the P11Ds to HMRC online.

This return has to be made if you have had ANY employees during the year, even if they no longer work for you or if the company has ceased trading.

HMRC are imposing automatic penalties for late filing of the returns, as follows:
£100 per 50 employees for each month or part month that the returns are outstanding.

If you are one of our clients and have not yet returned the form we sent you in April, please return this AS SOON AS POSSIBLE to enable us to submit your return before the deadline.

If you are not a client and are not sure if you have to make a return, or need some help in doing so, we offer P35 and P14 filing service for a fixed fee.. please get in touch with us to discuss.

Childcare Vouchers are currently tax and NI exempt up to a maximum of £243 a month for everyone, generating valuable savings for parents and employers. This means that employees on higher earnings receive a greater tax saving than those who pay tax at the basic rate. The change evens out the amount of tax saving available for all employees regardless of the rate that the individual pays tax, meaning that anyone who joins an employer supported childcare scheme from 6th April 2011 will receive the same level of income tax exemption, which is approximately £11 per week.

The changes will only affect employees who join an employer’s scheme on or after 6 April 2011. Any employee who already participates in your scheme will not be affected. They will retain their current level of tax savings until they leave your scheme or are no longer eligible to participate – for example if their child no longer receives qualifying childcare.

For employees joining a childcare voucher scheme after 6th April 2011, the employer will need to carry out a ‘basic earnings assessment’ to decide what level of childcare vouchers the employee can claim. The employer must carry out the earnings assessment when the employee first joins the scheme, then annually at the beginning of each tax year. You do not have to send your calculation to HMRC but must keep a copy of them, as they will be requested if you have a PAYE audit.

For more information please see information on HMRC website..
http://www.hmrc.gov.uk/thelibrary/employer-qa.pdf

The latest emails look very authentic and even have links to the genuine HMRC website and appear to come from genuine @hmrc.gov.uk email addresses.  These emails inform the recipients that their tax has been calculated and they are due a refund, and include a link to a website which requests your bank details to make the repayment into.

The HMRC website states that they would not inform customers of a tax rebate via email.

Bogus callers

HMRC is currently aware of telephone calls where the caller alleges they are from HMRC. Customers are asked for their bank details so a refund can be made for a fee. HMRC will never ask you for a fee to provide any services including repayments of tax. If you cannot verify the identity of the caller HMRC advise you to report it to the police immediately.