Happy new tax year!

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.

Comments (3)

  1. kathy faulks:
    Mar 20, 2014 at 12:59 PM

    I would buy lots of ginger beer and hard boiled eggs for Kirren Isle Community Association.

  2. A Herbert:
    Apr 01, 2014 at 12:54 PM

    It would be useful the HMRC link to be included in this article so that employers can read up on this.

  3. Claire Welling:
    Apr 02, 2014 at 02:16 PM

    A link to the HMRC website is now included at the top of the page which clarifies what is happening. Thanks for suggesting this.

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