Drummond Laurie would like to bring to your attention two legislative changes for the coming Tax Year 2015/16 which will affect you as an employer if your employee’s details are not correct.
All employers should consider the points shown below:
The Employment Allowance of up to £2,000 per business which was introduced in 2014/15 will be repeated in the new tax year.
Also as an additional incentive to employers to take-on more young people, there will be no Employer National Insurance contributions charged for employees under the age of 21 from the 6th April 2015. This means that there will be a change in National Insurance Table Letter for those employees less than 21 years of age. In tax period 1 of the 2015/16 Tax Year, the employer should automatically change the National Insurance Table letter to either M, I, Z or K in accordance with their current table letter of A, D, J or L for those aged under 21. We would therefore advise you to check:
Is every date of birth you hold for your employees correct, especially for those showing as being under the age of 21? If not, you should advise your payroll provider as soon as possible of any changes required or correct your own payroll system.
By way of example, if a business employs 5 young people under 21 years old and pays them each £15k p.a., the saving in Employers National Insurance to that employer will be in excess of £5k p.a., not an insignificant sum.
Employers who operate Contracted out Pension Schemes:
In the current tax year all employers who operated a Contracted out Pension Scheme have to include a SCON number on any RTI submissions. If this was not available then a dummy number was accepted.
From the 6th April 2015 dummy SCON numbers will no longer be accepted by HMRC. The SCON number for the company can normally be found on your Contracting out certificate or from your pension provider.
With effect from April 2015, no files will be accepted by HMRC without the correct SCON number.
Drummond Laurie can help you with this and other payroll related topics including Auto-Enrolment. For an initial chat, please call Gillian Niven on 01324 441280 or email firstname.lastname@example.org.