Categories
General Taxation

Increasing the flat rate tax deduction for homeworking:

The government will increase the maximum flat rate tax deduction available where employees incur additional household costs where they work at home under homeworking arrangements, from £4 per week to £6 per week. This will take effect from April 2020.

Source HMRC March 2020

Categories
General Taxation

Employment Allowance increases for National Insurance from April 2020

This measure increases the maximum Employment Allowance by £1,000 to £4,000 from April 2020. This means eligible businesses and charities will be able to claim a greater reduction on their Secondary Class 1 National Insurance contributions liability. Separate to this Budget measure, HMRC has also previously announced that from 6 April 2020, eligibility rules for claiming the Employment Allowance will change – the £4,000 will count towards de minimis State aid ceilings. For more information on this please visit GOV.UK.

Source HMRC March 2020

Categories
Taxation

Scottish Income Tax 2019-20

Under provisions of the Scotland Act 2016, Scotland’s can set the bands and rates of income tax for fiscal years. The following rates and bands, which were announced in the Scottish Budget delivered in December, will have effect for tax year 2019–20, subject to approval by Scotland’s parliament:

● 19% starter rate – £12,500 to £14,549
● 20% basic rate – £14,549 to £24,944
● 21% intermediate rate – £24,944 to £43,430
● 41% higher rate – £43,430 to £150,000
● 46% top rate – over £150,000.

Source CIPP Magazine Feb 2019

Categories
Sick Pay Taxation

Statutory Payments 2019-20

Statutory payments 2019–20

THE DEPARTMENT for Work and Pensions (DWP) has announced proposed
revised amounts for various statutory payments from April 2019. Though the DWP
has yet to confirm the effective dates, the following reflects the position of most
changes occurring on the first Sunday in April.

● Statutory maternity pay (SMP) – The weekly rate of SMP increases to
£148.68 with effect Sunday 7 April 2019. To qualify for SMP, the employee must
have average weekly earnings (AWE) of at least:
£118, if the baby is due on or after 21 July 2019
£116, if the baby is due on or before 20 July 2019.

● Statutory adoption pay (SAP) – The weekly rate of SAP increases to £148.68
with effect Sunday 7 April 2019. To qualify for SAP the employee must have AWE
of at least:
£118, if matching or notification occurs on or after 7 April 2019
£116, if matching or notification occurs on or before 6 April 2019.

● Statutory paternity pay (SPP) – The weekly rate of SPP increases to £148.68
with effect Sunday 7 April 2019. To be entitled to SPP the employee must have
AWE of at least:
£118, if the baby is due on or after 21 July 2019 (or the adoption matching
or notification occurs on or after 7 April 2019)
£116, if the baby is due on or before 20 July 2019 (or if the adoption
matching or notification occurs on or before 6 April 2019).

● Statutory shared parental pay (SShPP) – The weekly rate of SShPP
increases to £148.68 with effect Sunday 7 April 2019. To be entitled to SShPP
the employee must have AWE of at least:
£118, if the baby is due on or after 21 July 2019 (or the adoption matching
or notification occurs on or after 7 April 2019)
£116, if the baby is due on or before 20 July 2019 (or if the adoption
matching or notification occurs on or before 6 April 2019).

● Statutory sick pay (SSP) – The weekly rate of SSP increases to £94.25, from
6 April 2019. To be entitled to SSP for any periods of incapacity for work (PIW)
commencing on or after 6 April 2018 (and which do not link to an earlier PIW)
employees must have AWE of at least £118.

If the employee’s maternity, adoption, shared parental or paternity pay period
started on a day other than a Sunday, the new weekly rate of SMP, SAP, SPP or
SShPP does not apply until the beginning of the first complete SMP-, SAP-, SPPor
SShPP-week following Sunday 7 April.
It is expected that employers will continue to be able to recover 92% of SMP,
SAP, SPP and SShPP and that ‘small’ employers will be able to recover 100% of
SMP, SPP, SAP and SShPP plus a further 3% as ‘compensation’ for the employer (secondary) NICs incurred.

Source CIPP Magazine Feb 2019

Categories
Taxation

Welsh rates of Income Tax

The Welsh rates of Income Tax will come into effect from
6 April 2019 – the 2019 to 2020 tax year onwards.

Identifying Welsh Taxpayer Employees

Employers will not be responsible for identifying
Welsh taxpayers, this will be done by HMRC.
HMRC will tell you which tax code is appropriate to apply
to an employee in advance of the introduction of the Welsh
rates of income tax. Tax codes for Welsh taxpayers will be
prefixed with a ‘C’.
If the employee has been identified as a Welsh taxpayer it
will be because they:
• are resident in the UK for tax purposes
• have had a main place of residence in Wales for more
of the year than in any other part of the UK

It’s the employee’s responsibility (not the employers) to notify HMRC of a change
of address. However, if you have employees moving from Wales to another
part of the UK or vice versa, you should advise employees to contact HMRC to
change their residential address and notify the date of the move. This will ensure
HMRC can determine the employee’s Welsh taxpayer status.

Source HMRC