The document outlines updates from HMRC regarding payroll and HR solutions as of October 2009, highlighting major enhancements to the PAYE service for efficient management of tax and national insurance information. It specifies new regulations for employer annual returns, tax changes, and the equalization of state pension age, while also addressing changes to minimum wage rates and penalties for late payments. Additionally, it provides resources for further assistance and outlines upcoming changes in 2011.

1. Softworld HR and Payroll Solutions
October 2009
HMRC Update
Phil Nilson
HMRC Business Customer Unit

2. Agenda
• Things you need to know today
• Looking ahead to April 2010…
• …and beyond to April 2011

3. Things you need to know today

4. The PAYE Service
• Major upgrades to our IT systems were completed on
time
• For the first time, we can see a customer’s PAYE tax,
employment and National Insurance information in one
place…
• …which means we are able to deal with the majority of
enquiries at the first point of contact, wherever in the UK
the customer lives
• The new service has been made available to 28,610
HMRC staff

5. The PAYE Service
Benefits:
• A faster, more efficient process
• Greater accuracy
• Less unnecessary customer contact
• Better use of resources
• Better customer service

6. PAYE Desktop Viewer (PDV)
PDV lets you view, manage and sort tax codes and notices
• Gives you a summary of the codes you have received
• Lets you mark codes as ‘Actioned’ or ‘Unactioned’
• Lets you create lists based on specific search criteria
• Lets you add a comment to a code or notice
• Create a file to send to another PDV user
• Go to www.hmrc.gov.uk/paye/tools/PDV

7. Customers with a gap in their National
Insurance record for 2007-2008
• Letters issued between 31 August and 20 November
• 3 million expected
• We are writing to employers to schemes whose schemes
were not processed by the end of August
• Employers can ring: 0191 225 3033
• Number for employees: 0845 915 5996

8. National Minimum Wage
Rate Current rate New rate
(up to 30 September) (from 1 October)
Main rate for workers aged £5.73 £5.80
22 and over
Rate for workers aged £4.77 £4.83
18-21
Rate for workers aged £3.53 £3.57
16-17 and over compulsory
school age

9. National Minimum Wage – Other issues
From October 2009:
• Tips, gratuities, cover charges and service charges no longer count towards
NMW pay
From October 2010:
• Main rate extended to 21 year-olds
For further help:
• www.businesslink.gov.uk/nmw
• the Pay and Work Rights Helpline 0800 917 2368

10. Employer CD-ROM

11. Looking ahead to April 2010

12. Employer Annual Returns
• Employers with 50 or more employees already have to send their Employer
Annual Return online
• New Regulations laid on 13 August 2009 mean that employers with fewer
than 50 employees will have to send their Employer Annual Return online
from 2009-10
• That Return is due by 19 May 2010
• If you file your Return on paper you may be charged a penalty of up to £3000

13. Employer Annual Returns
• A few employers will not have to file their Employer
Annual Returns online from 6 April 2010.
• Exceptions will include:
domestic employers
certain religious groups
carer and support employers – that is people who
employ someone to provide care for them at home

14. What employers need to do
• You must first register and enrol with HMRC’s Online
Services by going to our website at www.hmrc.gov.uk
• We have teams around the country who can help with advice,
presentations and registration surgeries
• Go to www.hmrc.gov.uk/bst/advice-teams-area/map2.htm
• Or your CD-ROM

15. Tax changes from April 2010
• Personal Allowances to be reduced by reference to an
‘income limit’ of £100,000
• Reduction will be £1 for every £2 above the income limit
• Additional higher rate of 50% for income above £150,000

16. Tax rates from 6 April 2010
Taxable income
Basic Rate 20% £0 – £37,400
Higher Rate 40% £37,401 –
£150,000
Additional 50% Over £150,000
Rate

17. Late payment penalties – The proposals
– Announced at Budget 2009
– Implementation intended to begin in 2010

18. Late payment penalties – The proposals
The intention is that they:
• will apply to all employers
• replace the current ‘late payment surcharge’ applied
to employers with 250 or more employees
• are expected to apply to payments due from
19/22 May 2010
• are likely to be calculated and assessed after the end of the
relevant tax year

19. Late payment penalties – The proposals
The intention is that:
• There will be no penalty if there is:
• a reasonable excuse for the lateness; or
• only one default in the year
• Penalties will range between 1% and 4% depending on the
number of defaults…
• …but you may have to pay additional penalties of 5% if any
payments are still unpaid after 6 and 12 months
• All carry the right of appeal

20. Late payment penalties – How to avoid them
• Make sure you pay on time!
• Phone the Business Payment Support Service if you have
worries about being able to pay
• No further penalties for payments made under a
time to pay agreement
• penalties already charged can be included in the
agreement

21. Business Payment Support Service
• Introduced on 24 November 2008
• For employers worried about meeting payments
of tax, NICs, VAT and other payments
• Ring 0845 302 1435
• Have to hand:
– Your tax reference number(s)
– Details of the tax involved
– Details of when you expect to be able to pay the
liabilities

22. Equalisation of State Pension age
(SPa)
• From 6 April 2010 the age at which women reach SPa will gradually
rise to become the same as it is for men – 65
• The change will be phased in between April 2010 and April 2020
• All women born between 6 April 1950 and 5 April 1955 are affected
• All women born on or after 6 April 1955 will reach SPa at age 65

23. Equalisation of State Pension age
(SPa)
• DWP’s Pension Service will write to all women affected, advising
them of their revised pension age
• Women should notify their employers
• NICs are due from women over age 60 up to their
new SPa
• Category C NICs are due only in relation to employees working
beyond their SPa

24. Equalisation of State Pension age
(SPa)
For further information:
• www.hmrc.gov.uk/guidance.cwg2.pdf
• www.hmrc.gov.uk/paye/employees/changes/pension-age.htm

25. …and beyond to April 2011

26. National Insurance changes from April 2011
• Class 1 employee rate raised 0.5% to 11.5%
• Class 1 employee additional rate raised 0.5%
to 1.5%
• Class 1 employer rate raised 0.5% to 13.3%
• Similar increase to Class 1A and Class 1B rates

27. Additional Paternity Leave and Pay (APL&P)
• Government announced in mid-September that
APL&P will be introduced for fathers of babies
due to be born, or matched for adoption, on or
after 3 April 2011
• Draft regulations to be published on BIS’ website
• Cases possible for 2010-2011…
• …but no change to reporting requirements

28. Additional Paternity Leave and Pay (APL&P)
Further information available at:
• www.berr.gov.uk
• http://www.hmrc.gov.uk/news/index.htm
• http://www.hmrc.gov.uk/comp/notes12-2.pdf

29. Any questions?

30. Further help after today
www.hmrc.gov.uk
Employer CD-ROM
Employer Helpline 0845 7 143 143
phil.nilson@hmrc.gsi.gov.uk