We are posting various blogs this week on Facebook in relation to payroll to remind employers and potential employers of some of the issues they should be aware of:-

Paying Money to HMRC

·    You should pay what you owe in tax and national insurance by the 22nd of the month or the 19th if paying by post. If you usually pay less than £1,500 per month, you may be able to pay quarterly instead of monthly.

·     P60s should be given to employees by the 31st May each year, after the tax year just finished on the 5th April.

·    If P11d’s are completed for employees, these should be given to employees by the 31st July each year, after the tax year just finished on the 5th April

Remember each time an employee is paid an RTI submission should be made to HMRC.

National Minimum Wage Rates:

25 and over £8.21

21 to 24 £7.70

18 to 20 £6.15

Under 18 £4.35

Apprentice £3.90

The Employment Allowance

The Employment Allowance reduces the amount of National Insurance employers have to pay by up to £3,000 per year.

The Employment Allowance is an annual amount that is currently available to all businesses and charities (with some exclusions) to offset against their Class 1 secondary NICs (employers national insurance) bill. It remains at £3,000 for 2019-20.

Holidays

All workers have, from the first day of employment, the right to 5.6 weeks' paid holiday per year. You can work out how many days off you should get by multiplying the number of days you work each week by 5.6. Employers are allowed to include the eight UK bank holidays within your statutory holiday entitlement.

If an employee leaves your employment part way through a year, you must pay them for any leave accrued in that leave year. To calculate this, multiply their annual entitlement in days by a proportion of the leave year expired, and then subtract the number of days taken.

Registering for PAYE:

If you do want to pay a salary at an amount over the Lower Earnings Limit then you must register for PAYE with HMRC which means that you will have to file regular Real Time Information (RTI) reports.

A business does not have to register with HMRC for payroll if it does not pay workers at an amount over what is referred to as the Lower Earnings Limited.

Each year the amount of the Lower Earnings Limited changes. For the tax year 2019/ 2020 the current Lower Earnings Limited is £118 per week or £512 per month. Caution should be exercised as, at this level of pay, you will not get National Insurance credits towards your state pension. So this is a strategy best not employed for the long term.