Posted by Sally Nichols on 06 Apr 2011
2011 to 2012 Payroll Changes
HMRC are pushing online filing and almost all employers must now submit P35’s online and many must now submit forms throughout the year as well as the year end and so you must make sure you are registered. P45’s; P46’s will be an online submission.
Coding notices are being sent out at the present time – Most are sent through electronically now, but if your employees receive a new tax code ensure that they check their payslips to make sure their employers have received the same coding notice.
Changes to Tax & NI Rates
The basic tax-free allowance is up £1000 to £7475.00, giving a new standard tax code of 747L.
National Insurance rates are increasing by 1% to 12% for employees & 13.8% for employers. Employees earning above the upper earnings limit will now pay 2% on annual earnings above £42,475 – currently 1% on annual earnings above £43,875.
Payments made to employees who have not handed over a completed P45/P46 when starting; or who receive payments after a P45 has been issued on leaving will not longer be taxed on code BR, but payments will be subject to tax on code 0T which will ensure that tax is deducted on the full payment at their top rate of tax, this will effect higher rate tax payers.
Any employees who pay the top rate of 50% tax will have the tax relief on their pension contributions limited to the basic tax rate.
Contact Tax Innovations
Contact us about any of these 2011 to 2012 Payroll Changes.
- Property Partnership Incorporation and SDLT
- Non-Resident Landlords – UK Tax Update
- Tax Relief For Residential Mortgages
- Top 10 Expat Tax Tips for Individuals Moving to the UK
- UK tax residents – beware of US LLCs!