It is essential for businesses to keep up-to-date with new legislation surrounding employment taxation, benefits and expenses, but we appreciate how difficult this can be.

Given the new penalty regime and HM Revenue and Customs’ ‘Risk Based Approach’ to employer compliance, adherence to the PAYE and National Insurance Regulations is more crucial than ever.

We run a highly competitive payroll bureau for many of our clients. By outsourcing this technical work to us, our team of experienced payroll specialists can help you meet your compliance requirements and deal with the ever-increasing burden of PAYE and National Insurance Contributions (NIC) legislation.

We can also advise you on all employment tax related issues and support you when negotiating with HM Revenue and Customs.

As an employer it is your responsibility to deduct Tax and National Insurance from your employees under the Pay As You Earn (PAYE) regime and to give them adequate records of how you have done this.

You are also responsible for making adequate annual returns as well as either monthly or quarterly returns to HM Revenue & Customs.

Smailes Goldie Group can help with all your PAYE matters and our payroll department can ensure that your PAYE is always accurate.

The rules governing expenses and benefits are lengthy and complicated – and with HMRC penalties for mistakes and omissions also increasing, it is more important than ever to review what you are doing and plan ahead.

Form P11D guidance

Most businesses are required to file annual P11D Returns, including a declaration if no benefits were provided. There are penalties for failing to submit a P11D, as well as for incomplete or incorrect forms. Omitted benefits-in-kind are the most common type of failure discovered by HMRC during an Employer Compliance Review.

If Form P11D is incorrectly completed, there are substantial penalties. The P11D(b) is required to include details of the Class 1A NIC payable and must be submitted to HMRC along with Form P11D itself. If not submitted by 6 July, further penalties penalty may be charged in addition to the penalties for Form P11D. The Class 1A NIC is due by 19 July if paying by post or 22 July if paying electronically. Interest and penalties will be charged where payment is made late.

In view of the severe penalties in place for the submission of incorrect P11D Forms, it is essential that all relevant benefits are identified and properly included.

Our team of tax specialists can guide you through the process, ensuring you supply both correct and timely information to HMRC.

Salary Sacrifice Schemes

HMRC recognises that flexible benefit schemes are an important part of remuneration strategy and so certain benefits have been excluded from the changes. Employers and employees can continue to benefit from savings under salary sacrifice where benefits such as childcare vouchers, workplace nurseries, cycle to work schemes and gym benefits are provided.

As a general rule, if an employee swaps between cash earnings and a non-cash benefit whenever they like, any expected tax and National Insurance contributions advantages under a salary sacrifice arrangement will generally not apply although there are some exceptions.

The impact on tax and National Insurance contributions payable for any employee will depend on the pay and non-cash benefits that make up the salary sacrifice arrangement. You need to pay and deduct the right amount of tax and National Insurance contributions for the cash and benefits you provide. For the cash component, that means operating the PAYE system correctly through your payroll.

Smailes Goldie can help you reform a salary sacrifice scheme, while our payroll bureau, SG Outsourcing, can assist in the administration of all payroll-related tasks.

For a free, no obligation consultation, please contact us here.