- MIDLANDS EXCELLENCE AWARDS
- PLANNING AHEAD
- EMPLOYMENT RIGHTS – STATUTORY LIMITS
- ELECTRONIC PAYE PAYMENT DATES
- PAYE TAX CODES
- AGE DISCRIMINATION IN THE WORKPLACE
- HMRC NEW SCAM EMAILS
- DEFAULT RETIREMENT AGE
We are delighted to announce that Walker Thompson were presented with a Highly Commended award at the annual Midlands Excellence Awards held on the evening of 3 February at the International Convention Centre Birmingham. The award, presented by Sir Ranulph Fiennes OBE in front of over 1100 guests, recognises the significant attainment of quality which our business has achieved. Photographs of the event will appear on our website in the next few days.
As the final tax returns have been submitted for 2009/10 it is important to remember that the end of the current tax year will soon be upon us.
So what should you be considering?
Now is the time to review various issues related to your personal taxation affairs. You may wish to consider whether or not you have used your:
- capital gains tax annual exemption for 2010/11
- annual inheritance tax exemption for gifts
- annual Individual Savings Account investment limit
You may also wish to make additional pension contributions for the year. Contributions need to have been paid by 5 April 2011.
Please do get in touch if you would like any further advice on these or any other issues.
The limit on the amount of the compensatory award for unfair dismissal increased from 1 February 2011. The previous maximum of £65,300 increased to £68,400 due to inflation. This new limit applies where the event giving rise to the entitlement to the payment arises on or after 1 February 2011.
The maximum amount of a week’s pay for the purpose of calculating the basic or additional award of compensation for unfair dismissal or redundancy payments will be increased to £400. This increase on the previous limit of $380 applies from 1 February 2011.
The Business Link website includes a useful calculator of statutory redundancy entitlement.
HMRC are reminding employers to be careful that PAYE payments made electronically have been cleared into HMRC’s bank account by the due date. Many employers have taken advantage of the electronic payment option which generally gives a later payment date of 22nd of the month. However HMRC are stressing that where the 22nd falls on a non banking day (weekend or Bank Holiday) that the payment may need to be made earlier to ensure that HMRC has cleared funds by the due date. HMRC need to have received cleared funds by the last bank working day before the 22nd.
HMRC use the following example:
‘For example: 2010/2011 PAYE month 9 for period ended 5 January 2011.
The due date of 22 January 2011 falls on a Saturday (non banking day), so if you are paying electronically your PAYE payment must clear HMRC’s bank account by Friday 21 January 2011. You may therefore need to change your payment date to ensure you pay on time. If you do not do so, you will be noted as paying late, and late payments for this tax year may result in a penalty being charged.’
This HMRC example may be too late for those making electronic payments for January 2011 however the next time the 22nd falls on a non banking day is May 2011. Cleared funds must reach HMRC’s bank account by Friday 20th May 2011.
HMRC may, for the first time, issue penalties to any employer who makes late payments of PAYE more than once for 2010/11. These penalty notices will not be issued until after the end of the tax year.
HMRC are issuing PAYE tax codes for 2011/12. These new coding notices, which are due to be issued between January and March 2011, will be used against employees pay from April 2011 onwards. It is important that these coding notices are checked carefully and HMRC have provided the following links to help individuals to check their codes. However if you are unsure that your coding notice is correct and would like some further guidance please do get in touch.
Good news for many
The majority of taxpayers will see an increase in their tax code as the personal allowance for those under 65 increases from £6,475 to £7,475.
Those individuals with simple tax affairs (just one employer with no reliefs or benefits or tax underpayments brought forward) will generally not receive a coding notice. Their current coding of 647L will be automatically uplifted to 747L following general instructions to employers.
Although the personal allowance is increasing the point at which taxpayers start to pay the higher rate of 40% tax on their taxable income is decreasing (from £37,400 to £35,000). This will remove the benefit of the personal allowance increase for some taxpayers.
A new concept of withdrawing the personal allowance for those with adjusted net income over £100,000 was introduced in 2010/11 and will continue for 2011/12. The reduction in the allowance is by £1 for every £2 of adjusted net income above the income limit. Adjusted net income for these purposes is broadly all income after adjustment for pension payments, charitable giving and relief for losses. Individuals with adjusted net income of at least £114,950 will not be entitled to a personal allowance for 2011/12.
Ageism in the workplace is particularly topical this year, with the high profile case of Miriam O’Reilly highlighting some of the issues. In January 2011, Miriam O’Reilly successfully won an employment tribunal on the grounds of ageism after she was ‘axed’ from her job as a presenter on ‘Countryfile’, along with three other women, all over the age of 40.
Commenting on the outcome of the case, Michelle Mitchell, Charity Director at Age UK, said:
‘The outcome of this high profile case sends out a powerful signal that even in the youth-worshipping world of show business, age discrimination can be withstood. The idea that wrinkles or grey hair can sound the death knell for the careers of female TV presenters is beyond appalling, especially in a country where over a third of the population is aged 50 and over.’
To read relevant guidance for both employers and employees visit
HMRC have updated their guidance to taxpayers regarding scam emails.
HMRC are aware that bogus emails are being sent informing taxpayers that they are due a tax rebate.
In other cases people have received emails from email@example.com asking them to validate their online bank accounts by entering bank details onto a linked website, and other emails requesting personal information.
These emails are not from HMRC and they have confirmed that they would never inform a taxpayer of a rebate, or request any personal information, by email. No personal information should be given in reply to these types of email, or entered on any linked websites.
SMS text messages
HMRC are also warning about a SMS text message scam. They advise that if you receive an SMS text message claiming to be from HMRC asking you to contact any number other than 0845 300 3900 then this is bogus. Their advice is not respond to the number but instead report the matter to your HMRC Contact Centre. Please note that this guidance does not apply to any messages left in person by HMRC officers asking you to ring them back at your local office.
Where you have received a suspicious email please forward it to HMRC at firstname.lastname@example.org
Internet link: HMRC scam email example
The government has confirmed that the Default Retirement Age (DRA) of 65 for both men and women is to be abolished. Employers need to be aware of this change and the impact it will have on working practices.
Acas have produced a guide on working without the DRA which is available at the link below.
The following is an extract from the introduction from the Acas guidance:
‘The default retirement age (DRA) is being phased out over a transitional period running until 30 September 2011. Details will be set out in Regulations coming into force on 6 April 2011. The last day employees can be compulsorily retired using the DRA is 30 September 2011, so the last day to provide six months’ notice required by the DRA provisions is therefore 30 March 2011.
Employers can still use the DRA between 30 March 2011 and before 6 April 2011 but if they do so they must use the short notice provisions, under which an employee could claim compensation (subject to a maximum of eight weeks’ wages). Employers will not be able to issue new notifications of retirement using the DRA on or after 6 April 2011.
Transitional arrangements for phasing out the DRA
During the transitional period, retirements that were already in train can continue through to completion, provided that:
- a notification of impending retirement was issued by the employer prior to 6 April 2011
- a late notification is issued between 30 March 2011 and 5 April 2011
- the date of retirement falls before 1 October 2011
- the DRA procedure, as set out in the previous Employment Equality (Age) Regulations 2006, is followed correctly (including the employee’s right to request to stay on is given serious consideration by the employer); and
- the other requirements of the former DRA procedure are met (eg the person is 65 or over; or is the employers’ normal retirement age if this is higher than 65).
Retirements using the DRA will cease completely on 1 October 2011.’
Internet link: Acas guidance