Blog posts tagged in Payroll
The Payroll Giving scheme allows taxpayers to make a tax free donation to charity directly from their pay or pension. The use of the scheme has reduced over time and last year, a consultation was launched jointly by HM Treasury, the Cabinet Office and HMRC seeking views on plans to improve the scheme and increase overall donations to charity.
Following this consultation, the Government announced a number of new measures to help encourage greater use of the scheme. The most important announcement concerns the reduction in the number of days it takes for a donation to be processed from 60 to 35 days. This will allow charities faster access to monies that have been donated.
The vast majority of employers are now reporting their PAYE information in real time. Following the introduction of RTI in April 2013, it was decided to stagger the start of the in-year late filing and payment penalties to give employers more time to adapt to reporting in real time.
The new late filing penalty regime starts on 6 October 2014 for employers with more than 50 employees. There is an exemption for small employers until 5 March 2015. HMRC began charging interest on any in-year payments not made by the due date in April 2014.
Our Fee Protection Insurance provider, Taxwise reported a clear trend in the activity of HMRC, not only over the last few years but also a seasonal trend within each tax year.
The continued increase of activity from HMRC has been unrelenting, one of the key focus points for HMRC has been the SME and the Sole Trader. Many enquiries are relatively brief and produce little return for HMRC however they are clearly continuing to cast their net as widely as possible regardless of the implications on the SME economy which is continually quoted as the back bone of Britain in the economic recovery.
©Taxwise - specialist providers of TAX FEE Protection Insurance
The deadline for filing the 2013/14 returns of benefits and expenses paid to employees is 6 July 2014. Note that there can be significant penalties for incorrect returns so they need to be completed with great care.
The most common benefits in kind that need to be reported are company cars and loans over £5,000 on beneficial terms. Remember that unless the employer holds a dispensation from HMRC employees’ and directors’ reimbursed expenses, such as travel and subsistence, also need to be reported.
The promised hike in the personal allowance to £10,000 is confirmed for the tax year 2014/15.
The basic rate limit is £31,865 for 2014/15. This means that 40% taxpayers (if taxable income does not exceed £100,000) will partly benefit from the increase in personal allowance.
The introduction of the new system where HMRC collect Real Time Information (RTI) for PAYE, represents a fundamental change in the way employers interact with HMRC. The new system involves employers sending HMRC information about tax and other deductions each time a payment is made as part of the payroll process, rather than at the end of the year as is currently the case. The majority of employers are expected to join the scheme in April 2013 with some of the largest employers being gradually phased in until October 2013 in time for the national introduction of Universal Credit by the Department for Work and Pensions (DWP).
The High Income Child Benefit charge came into force on 7 January 2013 and applies to taxpayers whose income exceeds £50,000 in a tax year and who are in receipt of Child Benefit. The charge either reduces or removes the financial benefit of receiving Child Benefit. Where both partners have an income that exceeds £50,000, the charge will apply to the partner with the highest income.