Here’s what you need to know about the new tax year in the UK
The new tax year is fast approaching in many places across the world. For our British counterparts it is just a week away now, on April 6th. This means that time is running out to get to grips with all the changes afoot, many of which will be implemented as soon as the start of the new tax year arrives.
One of the key changes in the UK on April 6th is that the minimum contributions made by employers and employees towards their auto-enrolment workplace pension scheme is rising from 3 to 5% of a worker’s salary.
It is your, the employer’s, responsibility to be aware of the new rules and to implement these changes for your UK-based staff. If you are already paying above the minimum amount then you needn’t worry about this. If, however, you will be seeing changes, there are some things to bear in mind.
This new minimum contribution means that “the average worker on £30,000 per annum will see their annual take-home pay reduced by £253”, so as a result of this you may see an uptake in people opting out of the automatic system. Therefore even if implementing the change is plain sailing for you, you may need to make adjustments on the back of it anyway.
The easiest, simplest and safest way to avoid making mistakes on the back of the new rules is to ensure you are using a trusted payroll provider. This will by extension cover auto-enrolment – they will have everything in place to implement and process the changes on your behalf, so you can kick back and relax as April 6th rolls around.
Repercussions for errors with auto-enrolment are not to be underestimated – you face fines from the Pension Regulator of over $65,000 if things go wrong. It’s not something you can afford to slip up with, so make sure you’re ready.