-
bdhc blogs
-
archive
As you are no doubt aware 6th April 2020is the start of the 2020/21 tax year, and there are some important updates that you should be aware of:
National Minimum Wage (NMW)
From 1st April 2020, the NMW rates are due to change:
| |
From 1st April 2020
|
From 1st April 2019
|
|
NLW for workers aged 25 and over
|
£8.72
|
£8.21
|
|
NMW main rate for workers aged 21-24
|
£8.20
|
£7.70
|
|
NMW 18-20 rate
|
£6.45
|
£6.15
|
|
NMW 16-17 rate for workers above school leaving age but under 18
|
£4.55
|
£4.35
|
|
NMW apprentice rate *
|
£4.15
|
£3.90
|
*for apprentices under 19 or 19 or over and in the first year of their apprenticeship
There are no exemptions from paying the NMW on the grounds of the size of the business.
Auto Enrolment
The minimum % amounts you and your staff pay into your automatic enrolment pension scheme will remain the same.
How this applies to you:
- If you have eligible staff in an automatic enrolment pension scheme, you will need to make sure that at least the minimum amount is paid by you and your staff into the scheme.
- If you don't have any staff in an automatic enrolment pension scheme, you don't need to take any further action
The table below shows the minimum contributions payable:
| |
Employer minimum contribution
|
Staff contribution
|
Total Minimum contribution
|
|
Current Rate from 6th Apr 2019 onwards
|
3%
|
5%
|
8%
|
Employment Allowance Changes
There are three large changes announced for April 2020:
- For eligible companies, the Employment Allowance claimable will increase from £3,000 p/a to £4,000p/a from 6 April 2020.
- The employment allowance will need to be claimed each tax year, it will no longer automatically roll over if claimed the previous tax year
- Larger companies and groups will no longer be eligible
The more complex proposal is that companies with a secondary class I employer's National Insurance liability of greater than £100,000 will no longer be eligible. This also includes connected businesses, so if the combined liability is greater than £100,000 the group will no longer be eligible, even for a single nominated group member.
The £100,000 employers National Insurance is taken from the preceding tax year, so for a company to claim employment allowance in April 2020, their liability will need to be below £100,000 for the 19/20 tax year.
So, there you have it – hopefully the changes are straightforward enough for you to understand, but please contact us directly if you have any queries