It is the Budget statement today (Wed 19 March), but something which was announced last year could reduce your organisation's costs by £2,000. Claire Welling, Leeds Community Accountant at WYCAS, tells us more about this very pleasant surprise!
For the 2014-15 tax year the Government will introduce an allowance of £2,000 per year for all businesses and charities to be offset against their employer Class 1 secondary NICs liability from April 2014.
This means, if you have paid staff where you are paying Employers NICs, your payroll costs will be reduced by up to £2,000. As an idea of how much Employers NICs you are paying:
- If you pay any individual member of staff more than £613 gross pay per month, you will pay some Employers NICs.
- If the individual’s gross pay is £1,200 per month, the Employers NICs will be £81.14 per month (£973.68 per year)
The allowance is claimed through your payroll bureau or (if you do your own payroll) on your first RTI submission of the new tax year; you need to tick a box on the first Employer Payment Summary (EPS) submitted for 2014-15. The employer may need to send an EPS every month that they reduce their payments to re-claim the £2,000.
Then you can start planning what to do with the £2,000 which your organisation will have saved!
For more information
Wishing you all a very happy new tax year! For more information visit the HMRC website; alternatively, do check out the WYCAS website www.wycas.org.uk and/or let me know if you would like my thoughts upon any particular finance issue, by leaving a comment below.