Payroll Key Updates
April 2022 is the start of the new payroll year and with it brings quite a few changes.
- Tax-Free Allowance & Rate Bands: There have not been any changes to the tax-free allowance or rate bands for 22/23. However, there has been a small increase in statutory pay and an increase to the student loan repayment threshold for those on plans 1 & 4. The full listing of rates and thresholds can be found here https://www.gov.uk/guidance/rates-and-thresholds-for-employers-2022-to-2023
- National Minimum Wage: There has been an increase in the National Minimum Wage / National Living Wage. Those aged 23 and over, who are not in a qualifying apprenticeship scheme are entitled to £9.50 per hour from 1st April 2022 as a minimum. To find the full rates listing, follow this link https://www.gov.uk/national-minimum-wage-rates
- Class 1 National Insurance: There is an increase to Class 1 National Insurance contributions for both employees and employers of 1.25% for the Health and Social Care Levy. This is a temporary increase to Class 1 National Insurance. From April 2023, Class 1 will revert back to 21/22 levels and a new Health and Social Care Levy will be introduced in its own right. This also applies to those who are self-employed and pay Class 4. HMRC have stated that employers should notify all employees of this by adding a narrative of ‘1.25% uplift in NIC’s funds NHS, health & social care’ on their payslip.
- National Insurance Employment Allowance: The National Insurance employment allowance has increased to £5000 for the 22/23 tax year. To qualify, you need to meet certain criteria – more of which can be found here https://www.gov.uk/claim-employment-allowance#:~:text=Employment%20Allowance%20allows%20eligible%20employers,ends%20(whichever%20is%20sooner)
- National Insurance Employing a Veteran: Still on the National Insurance theme, the letter ‘V’ has been introduced for April 2022 and should be used as a National Insurance Category, if you are employing a veteran for the first 12 months of their civilian employment. This will allow Secondary Class 1 Employers relief in real-time on National Insurance. Prior to this, a claim had to be made. More information can be found here https://www.gov.uk/guidance/claim-national-insurance-contributions-relief-for-veterans-as-an-employer
- Construction Industry Scheme: If your Company suffers CIS, there is a change to the reporting requirements if you offset the CIS amounts against your PAYE bill. The EPS submission now must contain the Company’s unique tax reference number (UTR). Any submission made without the Company’s UTR will be rejected.
- Cycle to Work Scheme: The Cycle to Work coronavirus policy has been eased from 5th April 2022. Any employee wishing to join the Cycle to Work scheme needs to meet the normal qualifying conditions that were in place prior to Covid.
Keep up to date with any changes to payroll by checking out our blogs.