Since this article was published, the government have announced Tax-Free Childcare will be launched in early 2017.
We know this is a busy time of year for employers, closing one financial year and preparing for the next, so we wanted to offer some helpful advice. The latest Budget announcement brings news of change to salary regulations, which you’ll need to follow when administering your payroll and salary sacrifice schemes. We’ve provided a quick summary of some of the key things you’ll need to know below:
The 2015 Budget announced that the Government are increasing the personal allowance from £10,000 to £10,600 on 6th April. The plan is to increase the allowance further to £10,800 in 2016/2017 and £11,000 by 2017/2018.
The starting level for 40% tax will rise from £41,865 to £42,385 on 6th April. It is expected to rise again to £42,700 in 2016/17 and £43,300 in 2017/18.
National Minimum Wage
The national minimum wage for ages 21 and over is rising to £6.70 an hour in October 2015. This is an increase of 20p. If you offer apprenticeships in your organisation, the national minimum wage for an apprentice is increasing by 20% to £3.30 an hour.
It is important to update your payroll to reflect this, and to ensure that the new figures are taken into consideration when setting up salary sacrifices.
In order for your childcare voucher scheme to remain exempt from tax and National Insurance, you must review your employees’ earnings assessments at the start of each tax year.
Our online facilities show employers which scheme members require an earnings review, while our online calculator helps employers to get it right first time. We also offer online record-keeping facilities, providing a secure area to maintain all of your earnings assessments for HMRC compliance
The Government are still planning to launch Tax-Free Childcare in the Autumn of this year. There have been no further announcements on the details or launch to date. We are continuing to encourage all employers to protect your National Insurance savings by promoting your scheme and looking at alternative salary sacrifice offerings.
For more information call us on Call Wider Plan: 0800 612 9015 or email firstname.lastname@example.org.