The PAYadvice Series – Payroll Legislation Update 2021
PAYadvice.UK Legislation Update 2021
PAYadvice.UK have issued the latest version of the Legislation Update 2021 including the 6th April 2021 confirmed income tax values. This document is a compilation of the changes due for 2021 for the UK, Channel Islands and the Isle of Man.
The following are links to blogs and information on payroll changes for 2021.
Guernsey (1st Jan 2021)
The States of Guernsey Class 1 contribution changes for 1st January 2021 have been confirmed
Jersey (1st Jan + 1st Jul 2021)
The States of Jersey Social Security contribution changes for 1st January 2021 have been confirmed. Further changes have also been confirmed which apply from 1st July 2021.
United Kingdom (April 2021)
Right to Work checks
UK Budget 2021
The United Kingdom’s Westminster Parliament budget was held on Wednesday 3rd March 2021.
The April 2021 updated were confirmed with no imminent changes to tax, NICs and associated statutory changes. The new personal allowance and the higher rate tax band are indicated as being frozen until April 2026.
Employer Bulletin
The following HMRC Employer Bulletins contain added information and guidance:
UK Income Tax
The HMRC have issued the manual tax code tables for 2021/2022
Personal Allowances and Tax Codes
As part of the winter statement, it has been confirmed that the personal tax allowance which is currently £12,500 will be uplifted by the Inflation rate for September 2020 which is 0.5%.
The following values have been confirmed.
Revised Starter Checklist for April 2021 – employees and expats
With the introduction of Scottish Student Loan Plan 4, a revised Starter Checklist for both employees and expats is introduced for use for payment from April 2021.
Employer provided Childcare Vouchers – Basic Earnings Assessment
Real Time Information (RTI) changes
Minor changes have been to the RTI requirements with the introduction of the Scottish Student Loan plan type 4 along with standard annual changes.
-Benefits
Changes to the Van benefit charge
Changes to Van Benefit and Car and Van Fuel
-England and Northern Ireland
Details of the tax changes for England and Northern Ireland (referred to as the rest of the U.K.) are confirmed and effective from 6th April 2021.
If further changes are announced at the 3rd March 2021 UK Westminster Budget 2021, those changes will be effective at a future point in time.
-Scotland
The Scottish Government’s budget on Thursday 28th January 2021 announced the following which HMRC have confirmed as being effective from 6th April 2021.
-Wales
The Welsh draft budget published on 21st December 2020 proposes that no changes are to be applied for the 2021/2022 tax year. Income tax for Wales will mirror those for England and Northern Ireland. These have now been confirmed by HMRC as being effective from 6th April 2021.
National Insurance
As part of the winter statement, it was confirmed that values would be uplifted by the Inflation rate for September 2020 which is 0.5%.
Details of the indicated values are as follows:-
No payroll changes for NIC Holiday for veterans are taking place for April 2021, alternate temporary measures to claim the rebate will be implemented with a more full payroll change under consideration for April 2022.
Off-Payroll workers in the private sector
Off-payroll proposals are being progressed for implementation from April 2021. The PAYadvice.UK resources can be found at:
National Minimum & Living Wage
The 1st April 2021 National Minimum Wage and National Living Wage rates have been confirmed.
And for comparison the voluntary Living Wage Foundation rates
Statutory Payments
As part of the winter statement, it has been confirmed that values will be uplifted by the Inflation rate for September 2020 which is 0.5%.
Details have been confirmed as follows:-
Student Loan deductions
The student loan thresholds and rates operational from 6th April 2021 have been confirmed and issued along with details on the changes by the Scottish Parliament which bring into play Student Loan Plan 4:
Pension Auto Enrolment thresholds
The DWP and The Pension Regulator (TPR) have confirmed the thresholds applicable for pay reference periods commencing from 6th April 2021.
Tax Year End P60 2021/2022
The End of Year certificate formats for the tax year 2021/2022 are as follows:
Isle of Man (6th April 2021)
The Isle Man Budget 2021 has confirmed that there are no planned changes to Income Tax for the 2021/2022 tax year.
The Isle of Man have confirmed the NI threshold values to operate from 6th April 2021. The Upper Accrual Point is no longer applicable.
For a download copy of the PAYadvice.UK Legislation Update 2021, click on the picture following:
PAYadvice.UK – updated 6/4/2021