http://www.c-todd.com/ard/merge_doc.asp?AID=495&MergeFile=worldcup_2010.htm

They have now issued more detailed guidance on the way in which the penalties will work. The penalties will apply to PAYE deductions due for a period starting on or after 6 April 2010 include PAYE, Student Loan deductions, Construction Industry Scheme payments, Class 1 NICs, annual payments of employers’ Class 1A NICs and annual PAYE Settlement Agreements payments.

Deductions of PAYE, NICs, Student Loan deductions and Construction Industry Scheme payments are generally due by 19 of each month (or 22 if paid by electronic means and cleared into HMRC’s bank account). Small employers are able to pay quarterly.

HMRC are advising employers to let HMRC know if they are likely to have difficulty making a payment on time, so that arrangements can be made and penalties can be avoided. Their guidance states that where employers enter into ‘time to pay’ arrangements, before the liability becomes due, no penalty will be charged.

Penalties for late payment start at 1% increasing to 4% depending on the number of late payments in the year. Extra penalties will be added where liabilities are outstanding for a further six and then 12 months.

Internet link: HMRC guidance on late payment

The process of gathering the necessary information can take some time, so it is important that this process is not left to the last minute.

Employees pay tax on benefits provided as shown on the P11D, either via a PAYE coding notice adjustment or through the self assessment system. In addition, the employer has to pay Class 1A National Insurance Contributions at 12.8% on the provision of most benefits. The calculation of this liability is detailed on the P11D(b) form.

If you would like any help with the completion of forms P11D or the calculation of the Class 1A liability please get in touch.

Employers may wish to complete the forms electronically and submit them online.

Holiday entitlement is one of the complex areas which can cause employee dissatisfaction if not handled correctly, especially for those with part time or irregular hours.

Since 1 April 2009 the minimum statutory holiday entitlement has been 5.6 weeks inclusive of Bank Holidays, the equivalent of 28 days for those employees working a five day week.

Employers may of course offer more holiday if they wish.

To check either your own, or your employees minimum holiday entitlement visit the link below.

Internet link: Business link website

David Frost Director General of the British Chambers of Commerce (BCC) said:

“…… the employer National Insurance rise, planned for 2011, should be abolished in full. Most businesses expect VAT to increase after an election to help plug the hole in our public finances. Considering companies have already said that VAT would be less damaging to their operation than a hike in NICs, it seems obvious that the tax on jobs should be scrapped and replaced by a less harmful tax on consumption.”

The Government intends to introduce secondary legislation to scale back government payments due to Child Trust Funds from 1 August 2010.

From that date, payments at birth will be reduced from £250 to £50 for better off families, and £500 to £100 for lower income families; and payments at age 7 stopped.

The Government intends to introduce primary legislation to stop all payments from 1 January 2011. Additional contributions for disabled children will be paid this year.

From 2011/12 the money used for these additional contributions will be redirected to respite care for disabled children.

Chancellor of the Exchequer George Osborne will present the emergency Budget on Tuesday 22 June 2010.

We will keep you informed of announcements.

Employees do not need to pay NI’Cs on reaching State Pension age.

Some payroll software warns employers as women approach age 60 to check their national insurance status as previously women would have been exempt from the employee contribution from age 60. This warning may now be being issued too early.

As a result of changes brought in by the 1995 Pensions Act, from 6 April 2010 the age at which women reach State Pension age will gradually rise to become the same as it is for men of 65.  The change is being phased in between 6 April 2010 and 6 April 2020 on a sliding scale, and will affect women born between 6 April 1950 and 5 April 1955.  All women born on or after 6 April 1955 will reach SPa at age 65.

For more information see the latest Employer Bulletin and for a look up table of dates see appendix C following the link below.

Internet links: Employer Bulletin DWP report

The World Cup kicks off in South Africa on 11 June 2010 and employers need to plan ahead to try and keep everyone happy. As matches are due to kick off at 12.30, 15.00 and 19.30 (UK time) employers will need to plan ahead to ensure they have a clear and consistent policy for those wanting to watch matches.

Acas advice as detailed on their website is that employers should try to be:

• “Flexible, where possible – for example, by altering start and finish times during the working day or allowing longer lunch breaks
• Clear about what you expect from employees – in terms of attendance and performance during the World Cup. Managing employees’ expectations of what might be possible is key to keeping them onside
• Communicative – start talking to each other now about the World Cup and how you hope to manage leave and working hours
• Honest – if you cannot accommodate any changes to your work practices then say so. Also, you may need to remind employees that any special arrangements for watching matches are only temporary
• Fair – you need to be seen to be fair about the way you respond to requests for time off and avoid favouritism”.

For more advice visit the Acas website.  For details of when the matches are being played visit the FIFA website link below.

Internet links:    Acas article FIFA website

The Government recently announced that it will remove the requirement to re-apply for small business rate relief, which can reduce business rates by up to 50%, at revaluation, reducing bureaucracy for small businesses and billing authorities.

John Cridland, CBI Deputy Director-General, said:

“We’re concerned by the government’s announcement on business rates today. Although business rates will fall overall, in some areas of the country they will rise sharply, which is worrying at this critical time for the economy.

We called for the Government to cap business rate increases at lower levels than those announced today. For example, we called for a maximum rise of 7.5% for larger properties, but the government has announced a maximum rise of 12.5%. This is worrying.

We’re particularly concerned about the potential for sharp rises in business rates in London, where properties were revalued near the height of the market. Given the economic situation, a significant rise in business rates could make a critical difference to companies trying to survive the recession.”

C Todd & Co ~ Chartered Certified Accountant in the Broomhill district of Sheffield ~ www.c-todd.com