We are pleased to announce that the CIA (Construction Industry Accounts) Software update for the new making tax digital VAT reporting was passed by HMRC this week ready for the deadline in April 2019.
All customers will receive the update as its released
Week 53 payments may result in an underpayment or overpayment of tax for the year. This is due to HMRC guidelines specifying that a Week 53 payroll must be calculated on a Week1/Month1 basis. Thus giving an additional personal allowance to protect the level of take home pay the employee receives.
The yearly tax allowance is calculated on a 52 week year. i.e. The Tax Code 1150L gives the employee a tax allowance of £11,505 for the 2017/18 tax year spread over 52 weeks, giving a free pay of £221.34 per week. For a week 53 calculation, the employee is given an additional free pay allowance of £221.34, therefore increasing the yearly allowance to £11,731.02. The difference is what HMRC will be requesting.
An overpayment will occur if within the 52 week year, an employee has not reached the £11,505.
Please remember the HMRC servers are changing on the 14th February. If you still haven’t run the update please do. After the 14th you need the new server address to upload your HMRC returns (PAYE,VAT,CIS)
Remember that from the 6th April 2018 the minimum contributions of both Employees and Employers will change.
- Employer minimum contribution is changing from 1% to 2%
- Employee minimum contribution is changing from 1% to 3%
Next year (6th April 2019) they are changing again
- Employer minimum contribution will change to 3%
- Employee minimum contribution will change to 5%
If you have any questions please contact us.