07 Mar PAYE Changes
There are a number of upcoming changes that employers need to be aware of. Here we summarise those changes but please get in touch if you need any further information or assistance.
SSP relating to Covid
The SSP refund scheme relating to Covid ceases on 17 March 2022. The last date claims can be submitted is 24 March 2022. After that date, “usual” SSP rules apply to any sickness or isolation relating to Covid. Essentially, this means SSP is not due until the 4th day, as the first three days are “waiting days”. SSP payments cannot be reclaimed from HMRC.
National Insurance holiday for employers of veterans
From 6 April 2021, employers who hire former members of the UK regular armed forces during the first year of their civilian employment will be eligible for a zero-rate of secondary National Insurance contributions for up to 12 months – a potential £5,000 saving. Any earnings of qualifying veterans hired from 6 April 2021 will be eligible for retrospective National Insurance contributions relief.
Employers must continue to pay National Insurance contributions as normal until April 2022. At this point, employers will be able to claim back any National Insurance contributions qualifying for relief through a revised Full Payment Submission (FPS), applying new National Insurance contributions category letter ‘V’. Employers whose software does not support this functionality can write to HMRC to request the relief, and further information on this process will be published on GOV.UK in due course. For tax years 2022 to 2023 onwards, employers will be able to apply the relief through Real Time Information (RTI) as normal, through application of National Insurance contributions category letter V.
Employers must ensure that they keep records showing that they have hired a qualifying veteran, such as veterans ID card, discharge papers, or P45 from HM Armed Forces.
Health and Social Care Levy
On 7 September 2021, the Government announced a new 1.25% Health and Social Care Levy to fund investment in the NHS, health and social care. The levy will be introduced from 6 April 2022, when National Insurance contributions for employees under State Pension age, self-employed people and employers will increase by 1.25 percentage points and be added to the existing NHS funding allocation. Contributions will therefore increase to 15.05% for employers and to 13.25% for employees.
From April 2023, the levy will be formally separated from National Insurance contributions and will also apply to the earnings of individuals working above State Pension age. National Insurance contribution rates will then return to 2021 to 2022 levels and receipts from the levy will go directly for spending on health and social care.
2022-2023 National Minimum Wage Rates
- 23 and over – £9.50
- 21-22 – £9.18
- 18-20 – £6.83
- Under 18 – £4.81
- Apprentice aged under 19 or in their 1st year of an apprenticeship – £4.81
For more information on these changes or any other PAYE advice, please contact:
Andrea Lambert
01432 266630
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