Employer Bulletin: August 2021
11 August 2021
The bulletin contains a wealth of information of interest to payroll professionals and the work that they carry out, and the CIPP recommends that it is read in its entirety.
A couple of key items from the Bulletin are highlighted below, but the full version can be accessed here.
Changes to right to work checks from 1 July 2021
From 1 July 2021 employers cannot accept EU passports or ID cards as proof of right to work (with the exception of Irish citizens). The EU Settlement scheme application deadline was the 30 June 2021, and whilst there is no requirement to complete a retrospective check on anyone employed before 1 July 2021, EU citizens will need to satisfy new right to work criteria to work in the UK.
Coronavirus Job Retention Scheme (CJRS)
In July, the UK government contribution to CJRS reduced to 70% of an employee’s usual wages, meaning that the employer is required to pay the remaining 10% plus the national insurance and pension costs.
The bulletin also highlights the relatively new functionality where CJRS claims for 16 to 99 employees can be completed via spreadsheet upload.
Coronavirus and Social Security coordination with the EU
HMRC have an arrangement with the EU which can allow HMRC to disregard and individuals’ work location caused solely by the COVID-19 restrictions. Where an individual’s work location has changed, HMRC can consider individual circumstances to decide whether National Insurance contributions (NIC) are due in the UK. This arrangement will end no later than December 2021.
HMRC also provide a link to apply for a certificate to prove that an individual has to pay UK NIC’s.
Minimum Wage Compliance
1 in 5 apprentices earn less that their legal entitlement - according to a recent Low Pay Commission report. The August bulletin urges employers to check they are paying the correct minimum wage rates to apprentices, and highlights some of the most common errors.
Electronic Payment Deadline
A reminder that the August deadline falls on a Sunday, therefore employer PAYE payments must be paid by 20 August 2021.
Informal Payrolling of Benefits In Kind
In the February edition of the HMRC bulletin, HMRC said it would “no longer accept informal arrangements.” The August edition provides clarity that only new informal payrolling arrangements will be accepted in this tax year and can only be in place for a maximum of one tax year.
Businesses who previously had an informal payrolling arrangement are expected to register for formal payrolling before April 2022 for the 2022/23 tax year.
Off Payroll Working (IR35)
The employer bulletin highlights resources, including links to videos, webinars and guidance to direct readers to tools that may help employers to understand and comply with the rules. HMRC also urge caution on arrangements labelled as ‘contracted out services’ and encourage employers to be weary of claims that state they do not need to consider the off-payroll working rules.
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