Anna’s Accountancy Alerts – Week 13 (29th June – 5th July 2020)

business

Holiday Pay And Entitlement: Changes To Carrying Forward Annual Leave

From 26 March 2020, where it has not been reasonably practicable for a worker to take some or all of the 4 weeks’ holiday due to the effects of Coronavirus, the untaken amount may be carried forward into the following two leave years.

However, it does not apply if workers are still able to take leave; in these circumstances, you still need to facilitate leave being taken in the leave year to which it relates as normal.

Examples of where it may not be reasonable to take holiday include:

Where the business has faced a significant increase in demand due to Coronavirus that would reasonably require the worker to continue to be at work and cannot be met through alternative practical measures

The health of the worker and how soon they need to take a period of rest and relaxation

The length of time remaining in the worker’s leave year, to enable the worker to take holiday at a later date within the leave year

The ability of the remainder of the available workforce to provide cover for the worker going on leave.

You should continue to do everything reasonably practicable to ensure that the worker is able to take as much of their leave as possible to prevent your workforce burning out.

Where leave is carried forward, it is best practice to give workers the opportunity to take holiday at the earliest practicable opportunity.

Reminder For Reporting Expenses And Benefits For The Tax Year Ending 5 April 2020

The deadline for reporting any Expenses and Benefits is 6 July 2020.

You need to do this for each employee you’ve provided with expenses or benefits.

If you still need to make a report, you can avoid delay by using the following quick and easy methods:

  • commercial payroll software
  • HMRC’s PAYE Online service (now improved, to cater for employers with up to circa 500 employees)
  • HMRC’s Online End of Year Expenses and Benefits service.

Paying HMRC

Paying Class 1A National Insurance Contributions (NICs)

Electronic payment for Class 1A NICs declared on your P11D(b) return for the tax year ended 5 April 2020 must clear into the HMRC account by 22 July 2020.

Use The Right Payment Reference When Paying Class 1A NICs

Help ensure your payment is correctly allocated by providing the correct payment reference when making your payment.

Use your 13-character Accounts Office reference followed by the numbers 2013.

Adding 2013 is important because 20 tells HMRC the payment is for the tax year ended 5 April 2020, and 13 lets them know the payment is for Class 1A NICs. The reference should have no gaps between the characters.

Log in to your HM Revenue and Customs (HMRC) online account to make a single Direct Debit payment

Go to Pay employers’ Class 1A National Insurance – GOV.UK and click the green ‘Pay Now’ button to select one of 3 secure payment methods or for more information on how to pay your Class 1A National Insurance Contributions.

Deferring Self Assessment Payments On Account

If you make Self Assessment payments on account and are due to make a payment in July 2020, then you have the option to defer payment until January 2021.

If you are in financial difficulty as a result of COVID-19 and you choose to defer, then you simply don’t pay the amount due in July. There isn’t an application process – if HMRC don’t receive a payment they will automatically treat it as a deferral.

You should remember to cancel any direct debit payments you’ve set up so you don’t pay HMRC accidentally.

HMRC will not charge interest or penalties on deferred payments, provided it is paid in full by 31 January 2021.

If you are in financial difficulty due to COVID-19 then you have the option to pay the deferred amount:

  • As one payment between July and 31 January 2021;
  • Or by instalments.

Stay Up-To-Date With Coronavirus & Brexit News

Coronavirus has affected us all. Whether you’re a sole trader, employer or employee. Stay up to date with the latest news – including government support, tax implications, and more.