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Ending of Statutory Sick Pay percentage threshold scheme
From April 2014 HMRC have abolished the Statutory Sick Pay (SSP) percentage threshold scheme (PTS). The PTS scheme compensated mainly smaller employers for higher than average sickness absence.
Prior to April 2014 an employer was entitled to recover some of the SSP paid to their employees if the total of SSP paid in tax month was greater than a set percentage of their gross Class 1 National Insurance Contributions -NIC (employer and employees) liability for that month.
Employers will have until 5 April 2016 to recover SSP (under PTS where available) paid for sickness absences occurring before 5 April 2014 (2013/14).
Where a payment for SSP is being made from 6 April 2014 for a period of incapacity before 5 April 2014 but has been notified late then the employer will need to make an application for recovery using form SP32 ‘late claim for recovery of statutory payments or NIC compensation’. The claims under PTS for up to six years can be made up to 5 April 2016 after which time no claims can be made. Claims using form SP32 will be repaid by way of payable order.
If SSP has already been paid but just not recovered, a claim under PTS at 5 April 2014 and then the normal process for making adjustments to a closed PAYE year will need to be followed - correcting payroll errors of a previous year.
Employers will still have to pay SSP (see sick pay entitlement) and will be obliged to produce records that confirm they have met their legal SSP obligations should HMRC require them. The record keeping requirements for SSP prior to 5 April 2014 have been abolished but employers must keep the following records for SSP for three years from the end of the tax year they relate to.
- All sickness periods lasting at least 4 days;
- Your SSP payments; and
- Any weeks you didn't pay and why.
Please contact us for further information
Revised advisory fuel rates 1 June 2014
H.M. Revenue and Customs (HMRC) have published the latest advisory fuel rates relating to mileage payments for business travel in company cars. These are as follows:
| Engine size | Petrol | LPG |
| 1400cc or less | 14p ↔ | 9p ↔ |
| 1401cc to 2000cc | 16p ↔ | 11p ↔ |
| Over 2000cc | 24p ↔ | 16p ↓ |
| Engine size | Diesel |
| 1600cc or less | 12p ↔ |
| 1601cc to 2000cc | 14p ↔ |
| Over 2000cc | 17p ↔ |
The changes this quarter are highlighted in red above.
The new rates will be effective from 1 June 2014. However for the first month employers may continue to use the previously published rates if they choose to.
These rates will be reviewed again in August 2014 and any changes made will be effective from 1 September 2014. The revised fuel rates will be published on the fuel rates page on the HMRC website when they are released.
Advisory fuel rates can be used to calculate the following:
- Reimbursement to employees of fuel used for business travel in a company car;
- Repayment by employees of fuel used for personal travel in a company car;
- Allowable input VAT claims on business mileage claims in personal cars made by employees.
A more detailed explanation of the use of these rates is on the HMRC website.
The rates applying for earlier periods are also on the HMRC website.
If you have any questions regarding the use of advisory fuel rates or mileage payments please contact us.
HMRC campaign – offshore income
HMRC are currently running a campaign aimed at taxpayers who have undeclared income and gains offshore.
New international agreements will let HMRC see more about overseas accounts. If you have not declared overseas income and HMRC catch you, you will have to pay the undeclared tax, a penalty of up to double the tax you owe, and you could even go to prison if they pursue a criminal prosecution.
HMRC will soon be obtaining much greater information about overseas accounts, insurance products and other investments, including those held through overseas structures. This includes details of who is holding the account or asset, or owns the entity holding the asset including their name, address, date of birth, the balance of the account and payments made into it. They will be using this information to go after those who have evaded their taxes. It is important for individuals to use this campaign to come forward and declare all their offshore income and gains in order to obtain best terms for penalties.
Further information can be obtained here on HMRC website or please contact us for further advice.
Auto enrolment – Check processes and software
Before the staging date, employers must ensure that their computer systems will support and carry out the tasks required for auto enrolment including.
- deducting and paying contributions to the scheme
- monitoring the ages and earnings of your staff
- handling requests to join the pension scheme from members of staff who haven't been automatically enrolled.
If your existing payroll software does not support all the necessary requirements, the pension provider may provide certain services. Employers should contact their software and pension providers in order to understand which requirements will be supported. Alternatively, employers may need to purchase a middleware software package to integrate into their current system.
The Pensions Regulator has produced a detailed guide on the questions employers should ask their software provider at www.thepensionsregulator.gov.uk/employers/business-software.aspx
Once the systems are in place, employers should allow time to:
- test the systems and ensure they perform the required functions
- ensure all staff records are up to date so the information entered will produce an accurate report.
This is the fifth installment in a series of articles regarding auto enrolment as detailed on our Employer Action Plan. Previous installments detailed below:
2 -
3 –
4 –
For more information on pensions or for help making an initial plan please contact us.
Auto enrolment – Know your workforce
Your duties for each staff member will depend on their age and how much they earn. It is important to understand in plenty of time which staff you will need to auto enroll. The Pensions Regulator advises that you carry out an initial assessment of your workforce ahead of your staging date to understand your responsibilities before performing the formal assessment on your staging date
You will need to assess your staff into categories. Those employees aged between 22 and state pension age and earning over £10,000 per year should be automatically enrolled into a pension scheme and you will need to make contributions towards it. Employees of different ages and salaries have the right to opt in to your automatic enrolment pension scheme or to join a pension scheme after your staging date. The table below shows the rights of each staff category:
|
Age |
||||
|
16-21 |
22-state pension age |
State pension age -74 |
||
|
Annual earnings |
£5,772 or below |
Has a right to join a pension scheme |
||
|
Over £5,772 to £10,000 |
Has a right to opt in |
|||
|
Over £10,000 |
Has a right to opt in |
Automatically enrol |
Has a right to opt in |
|
The Pensions Regulator website contains more detailed guidance regarding changes in age and earnings, staff working outside the UK and contractors/agency staff at www.thepensionsregulator.gov.uk/employers/know-your-workforce.aspx
Employees have the right to opt out of automatic enrollment, but you must not encourage staff to opt out – this is known as ‘inducement’ and there are safeguards in place to prevent employers from doing so.
This is the fourth installment in a series of articles regarding auto enrolment as detailed on our Employer Action Plan. Previous installments detailed below:
2 -
3 -
For more information on pensions or for help making an initial plan please contact us.
Tax tables 2014-15
The latest version of our tax tables document has been published on the publications and useful links page.
VAT fuel scale charge changes from 1 May 2014
VAT fuel scale charges, for taxing private use of road fuel, are amended for periods commencing on or after 1 May 2014.
The scale charge for a particular vehicle is determined by its CO2 emissions figure. Where the CO2 emissions figure of a vehicle is not a multiple of five, the figure is rounded down to the next multiple of five to determine the level of the charge. For a bi-fuel vehicle which has two CO2 emissions figures, the lower of the two figures should be used.
For cars which are too old to have a CO2 emissions figure HM Revenue & Customs (HMRC) have prescribed a level of emissions by reference to the vehicle's engine capacity (cc) as follows:
| Cylinder capacity | CO2 band |
| 1,400cc or less | 140 |
| 1,401cc to 2,000cc | 175 |
| Over 2,000 | 225 or above |
The HMRC website has details of the CO2 emissions amounts and the related fuel scale charges. The tables on the HMRC website show VAT inclusive scale charges applicable in each accounting period, depending on whether it is a 12 month, three month or one month accounting period. Further into the document you will find the tables showing the actual vat to be paid.
If you have any questions then please contact us.
Dates and deadlines May 2014
Upcoming deadlines for businesses and individuals:
1 May: Corporation tax payment for a company not within the instalment regulations: year ending 31 July 2013.
2 May: Submission of form P46(car) for changes in quarter ended 5 April 2014
5 May: End of month 1 for PAYE (RTI). All FPS (Full Payment Submissions) due if taking advantage of concession where still available.
7 May: Online VAT return due to be filed and electronic payment of VAT due to be cleared into HMRC bank: quarter ended 31 March 2014.
12 May: Direct debit VAT payment will be taken: quarter ended 31 March 2014.
19 May: CIS monthly return deadline: month ended 5 May 2014.
19 May: Cheque payments for PAYE/NI, student loan, CIS to be cleared into HMRC bank: month ended 5 May 2014.
22 May: Electronic PAYE/NI etc payments to be cleared into HMRC bank: month ended 5 May 2014.
31 May: Provide all employees who were working for you at 5 April form P60 for 2013/14 by this date.
31 May : Company tax return CT600 due to HMRC: years ending 31 May 2013.
31 May: Company accounts (Private Limited Co) due to be filed: years ending 31 August 2013.
31 May: Company accounts (Public Companies) due to be filed: years ending 30 November 2013.
1 June : Corporation tax payment for company not within the instalment regulations: years ending 31 August 2013.
