New Government and HMRC announcements
There are two new announcements by the Government and HMRC, that are going to have a major impact on employers and employees. Both of these measures are presently in the planning and consultation phases, but there is no doubt that they will be implemented.
Real- time payroll submissions.
HMRC are proposing that the employee payroll details are to be electronically submitted to them at time of processing. When an employer’s payroll has been processed, all details will be submitted to HMRC at that time.
Employee details that will need to be held, and submitted, go far beyond the level of detail presently required and will include for example, ID information such as passport numbers, to allow HMRC to check whether an employee is eligible to be paid in the UK, to help combat payments made to illegal workers.
HMRC will also know in advance, of an employer’s PAYE/NIC monthly payment, allowing them to chase payments much more rapidly. And issue penalties/interest for non/late payments, because they will know the amounts already. The system will also be linked to the Government’s new Universal Credit system. Details of hours worked will have to be given, allowing HMRC to check that an employer is complying with National Minimum Wage requirements. Annual and possibly monthly Employer returns will not be required.
There are certain figures, that presently can only be given in the annual return i.e. Construction Industry Scheme figures. It is not know how this will work, under the new scheme.
The entire system, is not finalised, but when it is introduced, there will be major changes to the way payroll and employee data is transmitted to HMRC, and how they interact with employers.
It is proposed that the new system will be introduced with 2 years.
We will keep you informed of future developments.
N.E.S.T.
Over the next 5 years the government is planning to introduce a new pension scheme, the National Employment Savings Trust, NEST for short.
The scheme will be compulsory for all employers, (unless they can prove they have an existing employee-related scheme of at least equal quality), and will cover most employees. There will be an automatic enrolment into the scheme, with employees having the facility to opt out.
The Scheme will have both employer and employee contributions, on a compulsory basis. Presently, this is planned at between 1% to 4% of Gross pay, dependant upon earnings levels.
The scheme will be phased in over 5 years dependant mainly upon size employer. Small employers will be the last ones inducted into the system.
NEST is not a payroll, or accounting matter, as it relates to pensions and investment advice.
We have associates who can assist in any queries, and there is also a web site - www.nestpensionsadvice.com for further information
We will keep you informed of future developments.
