The Government has legislated to increase the holiday pay reference period from 12 to 52 weeks. This change is designed to even out the seasonal variation in pay for many casual workers. Alongside this change, the Government has also clarified that the holiday pay reference period should include as many whole weeks of pay information as are available (if less than 52 weeks). Opera payroll will be enhanced to cater for the changes to holiday pay average calculation.
This includes payroll changes for the 2019-20 year-end and the 2020-21 tax year.
More guides with Opera technical changes are available on our Support Portal
HMRC require the date the car was first registered and to record the zero-emission miles before exhaust emissions start. This changes only apply where the benefit is being payrolled (the tax implications of the benefit are dealt with through payroll, and not via a P11D).
The rule change ensures that such workers who work in the private sector for medium and large-sized organisations, and who would have been an employee if they were providing their services directly to the client, pay broadly the same income tax and National Insurance contributions as employees. The ‘fee-payer’ will have to deduct income tax and NI contributions from the payment that is due to be paid to the worker. The income tax and NI will then be paid over to HMRC as per other employees. The amount the off-payroll worker is paid will be reduced by the employee’s income tax and NI contributions as deducted by the fee-payer.
Where an employer is required to make amendments to an employee’s payroll figures for the previous tax year, HMRC will continue (during the 2020/21 tax year) running a pilot whereby, instead of an employer being forced to use an Earlier Year Update (EYU) online submission to make such amendments, the employer can instead send a Full Payment Submission (FPS) again for the final period of the last tax year. Opera payroll enhancements will be split into two phases.
New NI, PAYE and statutory payments rates and bands
It is anticipated that there will be the usual adjustments to tax and NI bands/rates, statutory payment amounts, auto-enrolment thresholds, etc. The budget for the UK (England and Northern Ireland) has been confirmed for 11th March 2020. The dates for the budgets for Scotland and Wales are yet to be confirmed.