Tag Archives: wages

Employment Allowance 2016/17

Employment Allowance is £3,000 for 2016/17

Did you know that from this tax year you can now get up to £3,000 off your National Insurance bill if you’re an employer? This has increased from the £2,000 allowance which could be claimed in both 2014/15 and 2015/16.

Not sure if you are eligible?

You can claim Employment Allowance if you’re a business or charity paying employers’ Class 1 National Insurance. You can also claim if you employ a care or support worker. However, you can only claim Employment Allowance for one PAYE scheme so if you’re part of a group, only one company or charity in the group can claim the allowance.

Directors, take note!

If you are the only employee in your company who has employer National Insurance deducted then the rules have changed this year and you are no longer eligible to claim the allowance. If you have claimed the allowance previously you need to make sure that you update your payroll records you reflect the fact that the business is no longer eligible and notify HMRC accordingly.

If you’ve never claimed Employment Allowance and think that you should have been then don’t panic, you can claim for a previous tax year dating back to 2014/15. For details on how to do his, or for any other information, you can visit the the https://www.gov.uk/claim-employment-allowance or get in touch with Lisa on 01872 271655 or by email at lisa.middleton@kelsallsteele.co.uk,who will be happy to help.

National Living Wage

One of the most notable announcements in this years’ Summer Budget was the introduction of a compulsory National Living Wage.

The new National Living Wage of £7.20 per hour will take effect from April 2016, being a top-up of 50p per hour to the National Minimum Wage (£6.70) for those employees aged 25 and over. The National Living Wage is set to increase each year, eventually hitting £9.00 per hour by 2020.

You may want to consider the cost implications of this for your business and importantly you may need to be aware that employees cannot make a ‘salary-sacrifice’ which takes them below the hourly minimum (£7.20) and you therefore may need to reconsider any existing or future sacrifice arrangements.

While many have been calling for the introduction of a ‘Living Wage’ for some time, it’s important to recognise the difference between the Chancellor’s’ newly announced National Living Wage and the Living Wage that is voluntarily paid by some employers.

The ‘other’ Living Wage that is talked about is calculated according to the basic costs of living in the UK by the Living Wage Foundation. There are two rates, a UK rate which is £7.85 and a London rate which is currently £9.15. Employers can choose to pay the Living Wage on a voluntary basis.

If you’d like any further information on the new National Living Wage, please don’t hesitate to contact us, enquiries@kelsallsteele.co.uk

National Minimum Wage Increases

Today sees the national minimum wage (NMW) rates increase. The new rates that apply as of 1 October 2013 are as follows:

  • Workers aged 21 years or over: £6.31
  • Workers aged 18 to 20 inclusive: £5.03
  • Workers aged under 18: £3.72
  • Apprentices aged under 19: £2.68
  • Apprentices aged over 19 in the initial year of their apprenticeship: £2.68

Apprentices aged 19 or over and having completed a year of their apprenticeship are entitled to NMW at the rate for their age.

Further details on the National Minimum Wage can be found on the GOV.UK website