Employer's Bulletin Issue 15

  

Employers Bulletin Issue 15 Amendments
There are corrections to issue 15 of Employers Bulletin

Contents

 

Welcome

Welcome to the September issue of Employer's Bulletin.

I'd like to start by expressing my thanks to all the employers and payroll staff whohave been paying Working Tax Credit to their employees despite the problems we've had with our computer system. I know many of you have experienced difficulties because of this and I am grateful for your forbearance. As you'll read in our Tax Credits article, work on the computer system is continuing and things have started to get better.

We get a lot of questions asked about the tax and NICs consequences of giving gifts to employees or throwing staff parties. To help make things clearer, we have put together a list of the most common questions we get asked and given a broad outline of the rules.

Our online services continue to grow in popularity. It seems that employers are getting more confident about using the services available to file returns and employee changes, and to make payments and access guidance. Take a look at the article for details about getting online. Also related is our news about a mailing we are making to all employers this autumn setting-out your obligations to e-file forms P14 and P35. Our mailing will tell you the date when you must e-file your returns - although smaller employers can start earlier and receive a tax-free amount from us.

As we go to print out Internet site is being re-designed to make it more user-friendly. Hopefully, by the time you read this all the work will have been completed. So, please log on and take a look especially if you haven't done so before.

I hope you find all the articles helpful. We'll be sending you our next Bulletin in February.

Don Macarthur

Employer Programme Director

Electronic filing - find out what you need to do

To help employers prepare for electronic filing we invite you to attend one of the seminars we have jointly arranged with Payroll World.

Dates:

Birmingham Wednesday 15th October 2003

Bristol Thursday 16th October

London Friday 17th October

Newcastle Thursday 13th November

Nottingham Friday 14th November

Plymouth Friday 21st November

London Thursday 15th January 2004

Brighton Friday 16th January

There's a reminder of the government legislation and the timetable for compulsory electronic filing in our article in this issue. These seminars have been designed to help all employers, large or small, decide how best to prepare for this. Larger employers will find it useful to send payroll and IT staff together to discuss the best way forward for their business. There will be only a limited number of places at each venue to allow all employers attending to discuss their plans informally with Inland Revenue and Payroll World experts.

For a full programme and details of cost, as well as the booking form, visit:

www.payrollworld.com email: training@payrollworld.com

or telephone: 020 7940 4801

 

Reimbursing an employee's bank charges if you pay them late

Most employees are entitled to be paid regularly on a certain day each week or month. If you are late paying such an employee their bank account may become overdrawn as a result and they may be charged a penalty or interest by their bank. To compensate for this you may decide to pay the bank charges on their behalf. In a case like this, the sum you pay to cover the bank charges would not normally be liable to tax and NICs.

If you pay an employee's bank charges for any other reason, that sum would normally be liable to tax and NICs.

If you believe that you have overpaid tax and NICs relating to a late salary payment to an employee, please contact your Inland Revenue office.

More details on this subject can be found in the June issue of Tax Bulletin.

Visit www.inlandrevenue.gov.uk and look in the `Publications' section

 

How the one per cent NICs increase affects deferments

The one per cent NICs increase that came into effect from April 2003 has resulted in changes to the deferment arrangements.

If you hold a valid deferment certificate (CA 2700) for an employee, you will need to deduct employees Class 1 NICs at one per cent from all their earnings above the primary threshold (currently £89 per week). You will continue to pay employers' Class 1 NICs on all earnings above the secondary threshold (currently £89 per week).

If, exceptionally, you forget to deduct the one per cent employees NICs in deferred cases but discover your error before the end of the tax year, you may collect the underpayment from any later earnings paid to your employee.

If you discover the error after the end of the tax year, you will have to pay any underpayment yourself.

The rules which allow you to recover underpayments from your employee's future earnings are explained at paragraph 9 on page 17 of the 2003 issue of booklet CWG2, Employer's further guide to PAYE and NICs (PDF 1.91MB).

Exempt benefits

The changes to the limits on exempt benefits mentioned in our last Bulletin, have now come into effect. This means that you can use the new limit for annual parties and gifts from third parties from 6 April 2003.

However the limit for long service awards didn't go up until 13 June and the limit for cyclists' breakfasts wasn't removed until 25 June.

 

The rates from October

Don't forget that the new rates come into effect from 1 October 2003 and they are:

  • £4.50 per hour for people aged 22 and above
  • £3.80 per hour for people aged between 18 and 21.

For more information and advice call the Helpline, the telephone number is at the end of this Bulletin.

Or log on to www.tiger.gov.uk

 

Statutory Maternity/Paternity pay - guidance booklets

A number of amendments and additions have been written for the guidance booklets E15 Pay and time off work for parents and E16 Pay and time off work for adoptive parents, along with their supplements.

Because the website is being re-designed at the time of going to print we cannot give you a proper web address for the new rules. But if you need to see them, visit the `Employer' pages and follow the links from there.

 

Updated PAYE Taxable Pay Tables in force from 15 June

Are you using the correct PAYE Taxable Pay Tables for your payroll? The new versions that came out earlier this year should be used from 15 June onwards.

We've updated the Tax Tables SR + B to D, Manual method and the Calculator method. The new versions are on the Employer's CD-ROM. But if you are using paper versions you should check that you are using the revised versions because we didn't send them to everyone - the latest versions have a message on the cover that says `Use from 15 June 2003'.

If you don't have the correct version call the Orderline on 0845 7 646 646.

 

CD-ROM car calculator - Must Read article

There is an error in the 2002-2003 car calculator on this year’s Budget CD-ROM. The maximum CO2 level for the 2002-2003 calculator is incorrectly set to 255 instead of 265, this error will affect any calculations on cars for 2002-2003 with CO2's of 260 g/km or more. Our apologies for this error. Our systems will identify and pick up any incorrect calculations so long as you have entered the correct CO2 figure on the P11D.
car calculator

New, improved SSP1

Department for Work and Pensions (DWP) has been working on a short version of the form SSP1 which employers use to tell their employee why they cannot get Statutory Sick Pay.

The new SSP1 will be available towards the end of September. You can get copies from your Jobcentre Plus or from the DWP website.

The Incapacity Benefit part of the form which employees used to complete has been removed. In future, if one of your employees wants to claim Incapacity Benefit they will need to contact their Jobcentre Plus and make a claim over the phone.

 

The tax and NIC rules governing gifts and parties for employees

With Christmas and several other festivals coming up over the next few months, you may be thinking of giving gifts to your employees or even throwing a party for them. Let's look at some of the most common questions employers ask about the tax and NICs rules. These rules apply not only at Christmas but to any annual party or similar function, as well as to gifts generally.

Remember, the answers here are general and give just a broad outline of the rules.

Q Can I give a tax free cash Christmas bonus or cash gift to my employees?

No. A cash gift or bonus is the same as normal pay and is subject to tax and Class 1 NICs in the usual way. The payment should be put through the payroll. This also applies to any vouchers you give that can be exchanged for cash.

Q Can I give my employees a Christmas gift such as a bottle of wine, a turkey or gift vouchers from, say, a high street store without them having to pay tax?

You can, so long as you set up an arrangement with your Inland Revenue office called a PAYE Settlement Agreement (PSA). If you set up one of these you have to pay the tax and NICs that is due and in doing so you relieve your employees of any tax liability.

A PSA also cuts down on record-keeping and paperwork, but you need to set these savings not only against the cost of paying the tax but also the additional NICs which you will have to pay on the total tax due under the PSA.

Q What if I don't want to arrange a PSA?

Then any non-cash vouchers that employees can exchange for goods will be subject to tax and Class 1 NICs. For tax, you should enter the cost of providing the vouchers on either a form P9D or a form P11D at the end of the tax year. For NICs the cost of providing the vouchers should go through the payroll at the time you give them to the employees.

For employees earning less than £8,500 the second hand value of the gift is subject to tax and should be reported on a form P9D at the end of the tax year. For directors and employees earning £8,500 a year or more, the amount is subject to tax and Class 1A NICs. The value of the benefit is the greater of the second hand value and the cost of the gift to you, and this amount should be entered on form P11D.

Q Can I provide a party for our staff at Christmas and in the summer, without employees being required to pay tax and NICs?

It depends on the cost of the parties. Tax and NICs are not due on any annual functions that cost you £150 or less per head per year in total. That is the limit for the tax year 2003- 04 (previously it was £75 per head). This rule applies to any annual social functions available to employees generally or available generally to those at a particular location.

For example, if your Christmas party costs £100 per head and the summer party costs £60 per head, the Christmas party could be treated as being exempt from tax and NICs. For directors and employees earning £8,500 a year or more the cost of the summer party would be subject to tax and Class 1A NICs and you would need to show it on the form P11D. You do this at section N.

Q I'd like to let my employees bring their partners along to the party. What are the rules for this?

As long as the cost per head of the function is £150 or less, there is no taxable benefit for the employee. If the cost per head exceeds £150, for a director or employee earning £8,500 a year or more the cost of the party for both the employee and their partner is subject to tax and Class 1A NICs. You would need to show it on the form P11D for the employee at section N.

For example, if an employee attends with his/her partner an annual event to which the exemption applies, and the cost per head is £100, there is no tax charge. On the other hand, if the cost per head of the event is £175, the employee is taxed on a benefit of £350.

Q How should I calculate the cost per head?

It is the total cost of putting on the function including accommodation, transport, food, drink and so on divided by the total number of guests including non-employees.

If you want to know more call the Employer's Helpline on 0845 7 143 143

 

Last chance to meet Inland Revenue experts in EmployerTalk 2003

One more event to come this year

The final event in 2003 takes place in Nottingham on Wednesday 8th October at the East Midlands Conference Centre. If you want to go along but haven't already booked a place call:

  • Deepa Giri on 0115 974 1365 or
  • Susan Birchall on 0115 974 1390

At an EmployerTalk you'll get the chance to hear key speakers from the Revenue give news and reminders on payroll matters. We also have a number of stands at which you can talk to staff and pick up material on lots of subjects that could help you such as Employee Share Schemes, the Employers CD-ROM and our Business Support Teams.

EmployerTalk 2004 is in the pipeline

We're already putting together a programme of EmployerTalk events for next year. The first two we've firmed-up will take place in:

Birmingham

24th February at the National Motorcycle Museum

For an invitation call Janet Wilkes Tel. 0121 535 6823

London

26th February at the Novotel, Hammersmith (note this is a change to our previous London venue)

For an invitation call Colin Thompson Tel. 020 7667 4669

Looking North

In March there will be EmployerTalk events taking place in the North East and North West of England. We are still sorting out the dates and venues but keep an eye on our website for details. Visit www.inlandrevenue.gov.uk/employers

Keep an eye on the Inland Revenue website for more details. And a full list of EmployerTalk events will be in our next Bulletin.

Tell us what you want

We want to tailor our events to meet your needs so we are constantly looking to improve them. We need you to tell us in particular what topics you would like us to cover in our payroll talks. What subjects interest you most. What payroll duties do you find difficult and want more help with.

If you have any suggestions, email them to emporderline.ir@gtnet.gov.uk

 

Following a pilot project, notices will start being issued. An employee of yours may receive one

Counting down to retirement

After a small-scale pilot exercise, the Revenue will in the Autumn start to issue what we call `Deficiency Notices' on a larger scale. But not everyone will receive one.

So what is a Deficiency Notice? Bulletin spoke to Phil Nilson of the National Insurance Contributions Office in Newcastle. "A Notice tells somebody that, according to our records, they don't appear to have paid enough National Insurance contributions (NICs) for a certain year, or years, to count towards their retirement pension."

Phil continued, "In the forthcoming mailing, the years we'll be looking at are 1996-97 to 2001-02 inclusive, and we expect to issue something in the region of 10 million Notices."

An opportunity: If we send someone a Notice along with its explanatory leaflet, it gives them the opportunity to look at what our records say and either

  • decide to make good any shortfall, or
  • let us know if they disagree with our records for any year(s).

"If someone disagrees with our records, we need to investigate and, where necessary, put things right," said Phil. "There are many reasons why contributions they have paid may not have reached their NI account. For example, an employee may not have given the employer their NI Number by the time the P14s for the year in question had to be submitted."

So, how could this be affecting employers? "Although we will be asking individuals to contact us when they disagree with our records, some employees will, instead, raise queries directly with their employer", he told us.

"If this happens to any employer, they should not get too involved but just give the employee any factual information about their earnings and contributions paid in the relevant year(s). They shouldn't try to offer them advice about pension entitlement, but instead refer them to the leaflet which they would have got with the Deficiency Notice. This tells them where to go for any further information they need."

 

Making payroll easier for you

We have a countrywide network of Inland Revenue Business Advisors. They can help you understand what payroll records you need to keep, which forms you need to fill in and answer all your questions.

To find out more about them, call 0845 60 70 143 06 or visit www.inlandrevenue.gov.uk/bst

  • to see a list of the payroll workshops they run, designed with busy employers in mind
  • to arrange a one-to-one visit at a place and time to suit you.

 

Keeping you posted

Later this year, we will be posting a letter to every employer in the UK as part of the moves towards electronic filing (e-filing) of End of Year Return forms P14 and P35.

The letter will tell you whether you are a large, medium or small employer, based on the number of employees you have on our records in October. This information is crucial because if you are:

  • a large employer (250 or more employees) you must e-file starting with your 2004-05 Returns (due by 19 May 2005) or face a penalty
  • a medium-sized employer (50 - 249 employees) you must e-file starting with your 2005-06 Returns (due by 19 May 2006) or face a penalty
  • a small employer (fewer than 50 employees) you must e-file starting with your 2009-10 Returns (due by 19 May 2010).

If you are a small employer, you can get up to £825 from us - tax-free! - over five years if you e-file early. Start e-filing from 2004/05 to get the maximum £825. To qualify, you must make sure that the software you use meets our Quality Standard. (Check with your software supplier. And there are details in the e-filing guidance that you will get with your letter.)

Your letter will let you know how you can appeal if, for example, we think you are a medium-sized employer but you are actually a small one. Most employers only have one PAYE scheme, but if you have more than one for different parts of your payroll, you will get a letter for each scheme.

Letters will be going out around the beginning of November. But if you have not had yours by the beginning of December, get in touch with your PAYE office.

  • If you are an employment agency, the guidance for agencies at Chapter 4 of the Employer's Further Guide to PAYE & NICs (CWG2) still applies.
  • If you have 250 or more employees, you will also have to pay PAYE, NICs, and Student Loan Deductions electronically starting with the May 2004 payment, or face surchages.

More information

Check out www.inlandrevenue.gov.uk/employers/ppip for more about e-filing and the early e-filing tax-free 'bonus' for small employers.

Go to www.inlandrevenue.gov.uk/howtopay/electronic_paye.htm for what you need to know about e-payment.

Details of other online services.

 

More and more employers are embracing the idea of working with the Revenue online

More and more employers are embracing the idea of working with the Revenue online. By doing it online many benefits are recognised, such as the speed of communication, reduced waiting times for employee tax codes to come through, as well as savings on postage, printing and paper storage. And many have told us that starting early has been good preparation to help them meet their filing obligations ahead of time.

The PAYE Online options

Employers and Agents can use either

  • Internet - to file forms and returns online
  • EDI - this stands for Electronic Data Interchange and is more suitable for larger employers with a high number or turnover of employees.

If you are not in a position to use these options you can always use the services of a payroll bureau who can e-file online for you.

Getting started

  • Find all the information you need to do it online at www.inlandrevenue.gov.uk and select `PAYE for employers'
  • Email our Inland Revenue Online Helpdesk at helpdesk@ir-efile.gov.uk, or
  • Call the Helpdesk on 0845 60 55 999

Making Payments Online

Online payments are more efficient and secure than payment by post. Payment services includes the Internet, telephone banking and BACS Direct Credit.

  • To make payments go to www.inlandrevenue.gov.uk select `employers' and then `Make payments'
  • Or call one of our Accounts Offices (the one shown on your payslip booklet)
    • - Cumbernauld
      01236 783717
    • - Shipley
      01274 539328

News and developments

The number of End of Year Returns we've received over the Internet has almost tripled compared with last year.

Improved access to our Online services is now available to both employers and individuals through our new registration and enrolment procedures.

We issued nearly 2.5million P6/P9 online to EDI customers during 2002-2003 - this is 80% up on the previous year.

Finally, Tax Credit Notifications - the TC700 series of Payment via Employer Notifications is now available as part of EDI.

Payroll Managers - an information gem!

If you use, design and operate your own computer payroll there are special notes which you may find useful.

The `Inland Revenue Notes for Payroll Software Developers' are published on a regular basis throughout the year. The Notes give advance information that you will need to keep your computerised payroll systems/software up to date with changing Inland Revenue Legislation. For example Budget updates, tax code changes and technical specifications for PAYE/NIC Tax Table Routines - as well as much more.

You can see the Notes on the IR website at www.inlandrevenue.gov.uk/comp

 

Payroll dates and events to make a note of

 

October 2003

October 8

  • EmployerTalk event - Nottingham, see main article

October 19

  • Payment for month/quarter ended 5 October should reach the Accounts Office by this date
  • Payment of your PAYE Settlement Agreement for 2002-2003 (if any) should reach the Accounts Office Network Unit

November 2003

November 2

  • Forms P46(CAR) to reach the Revenue - these cover employees whose car and/or fuel benefit has changed in the quarter ended 5 October

November 19

  • Payment for month/quarter ended 5 October should reach the Accounts Office
  • Expect your:
    • Letter and guidance leaflet about e-filing - see main article for details.

December 2003

December 19

  • Payment for month/quarter ended 5 December should reach the Accounts Office

January 2004

January 19

  • Payment for month/quarter ended 5 January should reach the Accounts Office

January - End

  • Reminder:
    • Register to use the Internet Service for PAYE to send your returns (P35, P14 and P38A) over the Internet. (You can in fact register to use the service at any time throughout the year.)
    • Business Support Teams begin their end-of-year/P35 workshops which continue through to the end of March.

February 2004

February 2

  • Forms P46(CAR) to reach the Revenue - these cover employees whose car and/or fuel benefit has changed in the quarter ended 5 January

February 19

  • Payment for month ended 5 February should reach the Accounts Office
  • Reminder that the Registration service to send PAYE returns over the internet is available

February 24

  • EmployerTalk event - Birmingham, see main article

February 26

  • EmployerTalk event - London, see main article

February - End

  • Expect your:
    • CD-ROM/Employer's Pack including Orderline information to order forms and guidance to finish this year and start the next
    • Updated software/instructions from your provider if you use a payroll package
    • Employer's Bulletin giving you all the latest payroll news including details of the 2004 EmployerTalk events
  • We advise you to:
    • Order the forms and guidance you will need to finish this tax year (ending 5 April 2004) and start the next.

 

Recent work has made the computer system more stable

Some employers will have received start, stop and amendment notices from the Revenue that they have had to clarify with us. We are very sorry that employers have had to check with us and for any errors.

Work to deliver the IT service we need is ongoing and will not be scaled down until any residual issues and teething problems are ironed out and we have a system performing to the standard we expected at the outset. The recent work that has been done means that the system is already relatively stable and running pretty well. This is good news as claims and enquiries can be handled faster, and employers should find that tax credit notices they receive have been issued right first time.

Guidance on paying Working Tax Credit is available in the booklet E6, Working Tax Credit paid with wages. You can get this by visiting our website (www.hmrc.gov.uk/taxcredits/forms-leaflets.htm) and clicking on WTC/E6 or by phoning the Employer's Orderline on 0845 7 646 646.

See also an article in Tax Bulletin 64 (www.inlandrevenue.gov.uk/bulletins)

Do it electronically

Employers may be interested in using our PAYE Online service to receive their tax credit payment via employer notices. These notices have been issued on paper since April 2003 and have also been available to large employers using Electronic Data Interchange. From December 2003 it will be possible to receive these notices over the internet by registering and enrolling for the PAYE service on the Government Gateway or the IR website.

For more information about this service see our main article.

What to do if you have made overpayments of Working Tax Credit (WTC)

If you have accidentally paid more WTC than you should have in one pay period, you may recover the excess from the employee by paying less WTC in the next pay period. This is a relaxation of the rules under the old systems of WFTC/DPTC. Under those rules you had to recover an overpayment as if it were overpaid wages.

If you inadvertently pay WTC to an employee after they have left your employment, or after they have died, as you were unaware of the date of leaving or death, call the Employer's Helpline (0845 7 143 143) within seven days of finding out. If you prefer to report the overpayment in writing, you can send details to one of the offices shown above. Whether you phone or write, you will need to provide the name and NINO of the employee, your PAYE reference number, the latest day for which you have paid WTC to this employee and the date of their leaving or death.

If requested, we will confirm to you in writing, for your records, the latest date that you paid WTC.

So long as you do this, you will not be held responsible for the overpaid WTC.

As long as you pay exactly the amount of WTC that we have told you to pay (on a start, amendment or re-start notice), we will not hold you responsible for any overpayment that arises from a mistake by us.

To contact the Tax Credit Office in writing:

Great Britain - Tax Credit Office, Preston, PR1 0SB

Northern Ireland - Tax Credit Office, c/o Employer Liaison Team, Dorchester House, 52-58 Great Victoria Street, Belfast, BT2 7QE

 

The latest NICs news

Married women paying reduced rate National Insurance contributions

If you have married women or widows working for you who have chosen to pay reduced rate National Insurance contributions (NICs) they should, from time to time, review that choice to make sure it is still the right one for them.

Reduced rate NICs do not count towards entitlement to any contributory benefits. So married women and widows paying the reduced rate do not build up entitlement to these types of benefits.

But they may be entitled to:

  • Statutory Maternity Pay
  • Statutory Sick Pay
  • Statutory Adoption pay and maternity allowance.

And based on their husbands NICs record they may also get a basic state pension of 60% of their husbands entitlement when he reaches state pension age and claims the pension (and they have reached state pension age.)

A married woman or widow loses her right to pay reduced rate NICs if she:

  • is divorced or her marriage is annulled
  • becomes a widow but is not entitled to Bereavement Benefit
  • loses her right to Bereavement Benefit
  • there are two consecutive years during which either
    • she has no earnings on which she has paid Class 1 contributions, except where the earnings were between the lower earnings limit and the primary threshold, currently £77 and £89 per week respectively
    • she has not been self-employed at any time.

You should:

  • ensure that those women are aware that they should report any changes to you and how they should do this
  • encourage them to review their decision to pay reduced rate NICs to ensure that it is still the appropriate one.

If you need any more information please call the Employer's Helpline.

Employees can get more information in the leaflets CA13 'National Insurance contributions for women with reduced elections' or CA09 `National Insurance contributions for widows or widowers' available from the Leaflets Orderline on 0845 9000 404, a local Inland Revenue (NICs) office or from our website at www.inlandrevenue.gov.uk

Are You Using the Correct National Insurance Table?

The Department publishes several National Insurance Tables covering the National Insurance Contributions (NICs) payable under a range of `NI category letters'. Using the correct Table and category letter will ensure that you deduct the right amount of NICs from your employees.

Which one(s) you use depends on your employees' circumstances.

For instance, if your employee is at least 16 years old, but under State Pension Age (60 for women, 65 for men), and not a member of your Contracted-out occupational pension scheme - you should be using Table A.

If you need to make sure you're using the right Tables and category letters call the Employer's Helpline - the telephone numbers are at the end of this Bulletin.

NICs calculator on Budget CD-ROM

If you've been using the National Insurance Contributions (NICs) calculator on this year's Budget CD-ROM, you may have noticed that the amount of NICs it calculates is slightly different to the amount shown in the paper NI tables. The calculator uses the `exact percentage method' to work out the NICs due on all of an employee's earnings - including pence.

The NI tables, on the other hand, calculate NICs at the mid-point between steps of earnings. So for example, if an employee earns £100.69 per week, the employer should go to the next smaller figure shown - £100.00. But the NICs for that figure are actually calculated on £100.50, the mid-point between £100.00 and the next step, £101.00.

So using the tables to calculate NICs can result in both the employer and employee paying slightly more or less than if the exact percentage method is used. However, both ways of working out NICs are acceptable.

 

Special rules for employees who were called up for active service

Do you have any employees who were called up earlier this year as Reservists for active service? Are they part of your Inland Revenue approved Employee Share Schemes or Enterprise Management Incentives?

If the answer is `yes' to both of these questions then special rules have been made by an extra statutory concession (ESC) A103.

ESC A103 allows employers of Armed Forces Reservists, who participate in an Inland Revenue approved share scheme or Enterprise Management Incentive to take the action necessary to maintain the reservist's participation in the scheme, for the period they are away on active service. The ESC applies from 7th January 2003.

For more information see Press Release No. 70/03 issued on 16 July 2003 which you can find on our website.

Other important news on Share Schemes

If you provide employment-related securities, that is shares or certain types of financial instruments (or options over these types of securities) to your employees, then you may be interested in looking at the latest information on the share schemes pages of the Inland Revenue website. It provides useful guidance on the changes made in Finance Act 2003 to the taxation of employment-related securities and employment-related securities options awarded to employees.

Changes have also been made to the rules for Company Share Option Plans, Save as You Earn Schemes and Share Incentive Plans to make them more flexible for employees and easier to run for employers. More information and answers to frequently asked questions are available on our website. Visit

www.inlandrevenue.gov.uk/shareschemes/news/index.htm

 

Employees now have 90 rather than 30 days to reimburse PAYE tax due on the value of notional payments

Employees now have 90 rather than 30 days to reimburse PAYE tax due on the value of notional payments that their employer was unable to deduct from their pay.

A notional payment is one where an employer provides an employee with a non-cash payment, for instance an award of shares under some employment-related share incentive arrangements. PAYE is due on this. If there is not enough cash pay to deduct the tax from, the employer pays the PAYE tax over to the Revenue from his or her own funds. If the employee does not reimburse the employer with the full amount within the time allowed, the amount not reimbursed is treated as taxable income of the employee.

The change applies to PAYE on notional payments made on or after 9 April 2003.

The NICs regulations have also been amended to use the same 90-day period. NICs as well as tax will become due on the amount of tax if it is not reimbursed within 90 days.

 

Reforms are on the way

In this year's Budget, the government announced that it would consult on the tax and NICs treatment of employer-provided vans.

A consultation paper was released that set out the government's thinking on how the existing van charge could be reformed.

The key proposals in the consultation document were:

  • A system that identifies availability for private use but recognises that there may be a requirement for vans to be kept home without any other private use being made of them.
  • Retaining the scale charge but making it easier for employers to operate.
  • Incentives for cleaner, more fuel-efficient company vans.
  • Introducing a fuel benefit charge.

The consultation period has now closed and the Revenue is looking at the comments it has received. Bulletin will give you more news on this in a future issue.

 

Contact numbers and online services.

Helpline and Orderline numbers

Helpline (for telephone advice) Orderline (to order your forms and guidance)

Calls may be monitored for quality control and training purposes

General payroll matters - for example PAYE, NICs and tax credits

Been an employer less than 3 years?

Helpline

0845 60 70 143

Mon-Fri 8am-8pm
   

Sat-Sun 8am-5pm

Textphone 0845 602 1380 (for employers who are deaf or hard of hearing)

Been an employer more than 3 years?

Helpline

0845 7 143 143

Mon-Fri 8am-8pm
   

Sat-Sun 8am-5pm

Textphone 0845 602 1380 (for employers who are deaf or hard of hearing)

Orderline for all employers

Orderline

0845 7 646 646

Mon-Fri 8am-8pm
   

Saturday 10am-1pm

Fax 0870 2 406 406 (Please use your Fax Order Form)

Website www.inlandrevenue.gov.uk/employers/emp-form.htm

Most of the forms you'll need can be downloaded from the Employer's CD-ROM

Construction Industry Scheme (CIS)

Contractors

Helpline

0845 7 33 55 88

Mon-Fri 8am-8pm
   

Sat-Sun 8am-5pm

Orderline 0845 3000 551 7 days a week 8am-10pm

Subcontractors

Helpline

0845 3000 581

7 days a week 8am-8pm
   

Sat-Sun 8am-5pm

Orderline 0845 3000 551 7 days a week 8am-10pm
 

NICs - special topics

Contracted-out Pensions

Helpline & Orderline

0845 9 150 150

Mon-Fri 8am-5pm

Non-residents

Helpline & Orderline

0845 9 154 811

Mon-Fri 8am-5pm

National Minimum Wage (NMW)

Helpline

0845 6000 678

Mon-Fri 8am-6pm

Orderline

0845 845 0360

7 days a week 24 hours

Other helplines

IR Online Services Helpdesk*

Helpline

0845 60 55 999

Mon-Fri 8am-10pm
   

Sat-Sun 10am-6pm
 

e-mail: helpdesk@ir-efile.gov.uk

* including technical support for the Employer's CD-ROM

Stakeholder Pensions

Helpline

0845 7 143 143

Mon-Fri 8am-8pm
   

Sat-Sun 8am-5pm

Accounts Offices

Accounts Office Shipley

01274 530750

Accounts Office Cumbernauld

01236 736121

To find the number of your local Inland Revenue office, look in the phone book under 'lnland Revenue'.

Employer Services

To visit the Employer's Website, go to www.inlandrevenue.gov.uk/employers

Here you will be able to access a wide variety of information for employers, and access to the Internet version of the Employer's Orderline.

 

If we are sending you too many packs, CD-ROMs or Bulletins, or you have changed address, please contact the Inland Revenue office that you normally deal with and let them know. Thank you.

Managing Editor: Pat Atkinson

Editor: John Nickless

If you want to send us any feedback about Employer's Bulletin please log on to www.inlandrevenue.gov.uk/employers/questionnaire.htm

e-mail: emporderline.ir@gtnet.gov.uk

Production: Inland Revenue, Business Services Forms, London

Bulletin is not comprehensive and has no legal force. It does not affect any right of appeal.

The Inland Revenue has a range of services for people with disabilities, including Braille, audio and large print. Contact your Inland Revenue office for details.

   
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