Can You Correctly Answer This Question On Taxation of Employee Expenses?

Payroll Services BirminghamWe are members of the Chartered Institute of Payroll Professionals. Earlier this year they posted this question on their website:

“If your employee has a meeting away from their normal workplace and they pass their workplace en route to the meeting, do they claim the mileage from home to the meeting or just from their workplace to the meeting?”

77% of respondents said they claim from the workplace to the meeting

21% of respondents said they claim the whole journey from home to the meeting

2% of respondents said you cannot claim at all

What would you have said? Who is correct?

The answer is – it depends. But the 2% were definitely wrong!

Your employee can claim mileage, but what they do on the way to the meeting determines whether they can claim from home to the meeting or just from their normal workplace to the meeting.

HMRC’s policy used to be that if the employee drove past their normal place of work they could only claim for the mileage from the workplace to the meeting. This policy has changed.

Here are 3 scenarios:

Scenario 1

The employee goes straight from home, doesn’t call in at the normal workplace and goes directly to the meeting.

They can claim mileage for the whole of the journey

Scenario 2

The employee pops into the normal workplace to collect some papers. They don’t do anything else and then go straight to the meeting.

They can claim mileage for the whole journey because what they did in the workplace is classed as ‘incidental’ by HMRC.

Scenario 3

The employee stops off at their normal workplace on the way to the meeting and has a short meeting with a colleague on a project.

They can only claim the mileage for the journey from the normal workplace to the meeting because what they did in the office is classed as ‘substantive’ by HMRC.

This survey resulted in 956 responses. One of which flagged up that the HMRC’s own EMI (Employment Income Manual) didn’t correspond to the guidance in the 490 Employee Travel – tax and NICs guide.  The CIPP has been assured that HMRC will look into this conflicting advice!

Payroll Masters is a premier outsourced payroll solution provider. We are based in Birmingham and we are experts in all matters concerning payroll.  So if you are ever in doubt, please contact us  we will be delighted to help.

Is It Ever Ok Not To Inform Or Consult On Redundancies?

Payroll experts birminghamCast your mind back to the Keeping Kids Company closure in August 2015. At the time it was a big media story because the charity had received a lot of government funding, then everything unravelled very quickly and the charity closed down.

KKC was taken to an employment tribunal accused of failing to inform and consult with their employees on pending possible redundancies. The charity offered the defence of ‘special circumstances’ sighting the events of August 2015 which lead to the closure and 20+ redundancies.

However, in June 2015 KKC applied for emergency government funding with a business plan to restructure the business whereby half of its staff might be made redundant within a few months.

The Employment Appeals Tribunal ruled that ‘special circumstances’ that occurred in August 2015 was not sufficient grounds for defence and that the duty to inform and consult with employees should have happened in June on the publication of their business plan.

Often employment tribunals rule in favour of employees because the employer failed to follow the correct procedure. Which is what happened in this case.  Clearly KKC was aware that redundancies were likely but they didn’t inform or consult with their employees.

Payroll and HR matters are very closely intertwined, and at Payroll Masters we understand when and how HR issues can impact on the processing of wages and salaries. For more complex HR matters we have tried and trusted partnerships with HR Service providers for commercial businesses and public sector organisations, and specialist HR Services for individuals employing people using Direct Payments.  Contact our Birmingham head office team or visit our HR Services page for more information.

Senior Staff And Directors To Be Prosecuted By The Pensions Regulator

Outsourced Payroll BirminghamThe Pensions Regulator is prosecuting the directors and some senior individuals at a Derbyshire based national recruitment firm.

This is the first time the TPR has launched prosecutions for computer misuse. The firm called Workchain Ltd, and formally known as Smart Recruitment UK Ltd, is accused of using employees personal details to log into their workplace pension scheme and terminate their employees membership of the scheme.  Employees can opt out of the scheme, but they are required to do this themselves.

The defendants, who have all been publicly named, have been summoned to Derby Magistrates Court on 7th June 2018.  If convicted for computer misuse in a magistrates’ court the maximum sentence is six months’ imprisonment and/or an unlimited fine.  Or two years’ imprisonment and/or and unlimited fine if committed to the Crown Court.

We are based in Birmingham, but support clients right across the UK on all their Payroll matters including pension administration services for Auto Enrolment. If you have a question, please contact us .

MPs To Examine If HMRC Deals Equally Fairly With Big Business and Small Businesses

Payroll Services BirminghamWe’ve all seen the headlines about businesses like Apple, Starbucks and Gap allegedly earning millions of pounds of profit in the UK but paying little Corporation Tax. It now seems that MP’s are going to look into this and whether HMRC adhere to their own internal governance processes to ensure that all tax disputes are dealt with fairly and in even-handed manner.

The Treasury Sub-Committee will study the steps HMRC has taken to address public concerns about the actions of some businesses and individuals who seem to be determined not to pay their fair share of tax. This scrutiny will also look into agreements reached that are outside of HMRC’s formal enquiry process.

Our head office is in Birmingham, but we have clients all over the UK who rely on us for help and advice on all matters related to Payroll including personal tax so please get in touch .