Originally planned for introduction in April 2018, due to delays in obtaining parliamentary approval, the changes have been deferred until April 2020.
New rules mean that the scope of termination payments exemptions align the rules so employers National Insurance Contributions (NICs @13.8%) are due on those payments over £30,000 which are already subject to Income Tax. The existing £30,000 tax exemption on termination payments is retained with employees continuing to benefit from unlimited employee NIC exemption.
This new Class 1A liability will be reported via Real Time Information (RTI) and paid at the same time as regular tax and NICs payments along the employers regular payments. The P11Db will not be used.
The liability on other non-cash elements are still declared and accounted using the P11D process.