New Features
> HMRC changes
HMRC changes
[For AccountEdge Plus and Network Edition users only]
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Student Loan Deduction changes
From April 2016 there will be 2 thresholds for Student Loan Deductions. Your software can calculate the deduction amount on the paycheques but will need to have the Plan Type used by the employee selected.
In the employee’s card payroll information deductions window, if the payroll year is 2017 the option to select the Student Loan Deduction Plan Type 1 or 2 will become available.
If the payroll year is 2016 there is only one threshold rate used to calculate the deduction.
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Scottish Rate of Income Tax
From April 2017 the Scottish Government can vary the rate of Income Tax (PAYE). This rate is determined by the employees tax code. If the first letter of an employees tax is “S” then the Scottish rate (SRIT) should be used. For 2017 the Scottish rate will be the same as the rest of UK.
When processing payroll for the payroll year 2017 and later, if the employees tax code is prefixed by ‘S’, the Scottish Income Tax rates will be used for tax calculations.
The 2017 tax rates have not changed with the exception of the UEL (Upper Earning Level) threshold being increased and the UAP (Upper Accrual Point) being removed.
RTI - Full Payment Submission (FPS) file will NOT show the ‘S’ prefix.
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NIC Category (Letter) changes - End of Contracting Out
From April 2016 pension schemes will no longer use a contracted-out salary related (COSR) occupational pension scheme to contract out of the State Scheme.
If the payroll year is 2017 then only the following NI letters are valid:
A Standard Rate
B Reduced Rate
C (Pensioners) Rate
H Apprentice Rate (Under 25)
J Deferred Rate
M Standard Rate (Under 21)
Z Deferred Standard Rate (Under 21)
X No contributions due
ECON and SCON fields are only required when Contracted-Out NI contributions are used.
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Apprentice NIC category
New Apprentice NI category - NI Table Letter ‘H’.
From 6 April 2016 a zero rate of Class 1 Secondary contributions has been introduced for apprentices under the age of 25.
To use this category the employee must be apprentices and under the age of 25.
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Flexible Pension Drawdown payments
From payroll year 2017 HMRC requires some pension payments, ‘Flexible Pension Drawdown’ payments and ‘Pension Death Benefit’ payments to be reported in the FPS submission. The Flexible Pension Drawdown, Pension Death Benefit and Trivial Commutation Payment are mutually exclusive. They are not displayed if the payroll year is 2016 or earlier.
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ECON removed from Full Payment Submission
As part of the Contracting-Out changes the ECON field has been removed from the submission for payroll year 2017 onwards.
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Employer Allowance
For the 2016 to 2017 payroll tax year the Employer Allowance has been increased from £2000.00 to £3000.00
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