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Employers’ Payroll Update 2

payroll update 2

Payroll Update – Part Two

The second and final part of our payroll update blog covers more developments and changes in payroll legislation that came into operation from 6 April 2017. The first blog covered Apprenticeship levy, Salary Sacrifice arrangements and the national Minimum Wage and National Living wage amongst other topics – view that blog here.

Auto Enrolment (AE)

Those organisations with a PAYE scheme not already in AE will reach their staging date for AE during the 2017-18 tax year.  You will have received notification from The Pension Regulator with regard to your staging date and will need a compliant pension scheme in place if you have eligible employees.  Whether we process your payroll or not we are able to advise you on all auto enrolment administration and complete onsite training on request.  If we process your payroll already we can accommodate the additional pension administration through the Sage Payroll Software. Please contact us for details of related costs for either option.

Payroll Year End filing deadlines for 2016-2017

Remember that you should have sent your final submission to HMRC by the deadline of 19 April 2017 and you need to distribute P60’s to your employees by 19 May 2017.

Statutory payments increases from 6 April 2017

Statutory Sick Pay (SSP) has increased from £88.45 to £89.35 per week

Parental payments – SMP/SAP/SPP/ShPP have increased from £139.58 to £140.98 per week

Tax codes and allowances

The personal tax allowance will be increased from £11,000 to £11,500 for 2017/2018.  Employees can earn up to £221 a week and £958 a month before tax is applied.  The emergency tax code for 2017/2018 will be 1150L, which is an increase of 50 points; this increase will also be applied to any tax codes with a suffix of L. Tax codes with a suffix of M will be increased by 55 pts and codes with a suffix of N will be increased by 45 pts.  HMRC will advise for S code and any other changes.

The new tax rates per annum are:

  • Basic rate              20%      from £0 to £33,500
  • Higher rate            40%      from £33,501 to £150,000
  • Additional rate       45%      from £150,001 and above

National Insurance contributions – rates and allowances

From 6 April 2017 the threshold changes will be as follows: 

 £ per week 



Lower earnings limit, primary Class 1



Secondary threshold



Primary threshold



Upper earnings limit, primary Class 1



Employees’ primary Class 1 rate between primary threshold and upper earnings limit



Employees’ primary Class 1 rate above upper earnings limit



Class 1A rate on employer provided benefits



Employers’ secondary Class 1 rate above secondary threshold



Right to work (RTW) in the UK

It has been a legal requirement for a number of years that before employing a new starter you should have seen and copied their RTW documents. From 2017 onwards when processing a new employee on Sage you will need to confirm the RTW check has been completed. If you are unsure of how to complete this check, which documents to ask for, or would just like some further guidance please follow the links below:

check job applicant right to work

right to work checklist


For further details on how we can help you with your payroll, auto enrolment and other outsourcing needs please click here.

If you would like any help or further information regarding any of the topics raised in our payroll update blogs, or have any other payroll query, please contact us

Jeanette White



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