Executive summary This is a Budget to fix the foundations of the economy and deliver change by protecting working people, fixing the NHS and rebuilding Britain. In July the government published an audit of public spending. This set out £22 billion of in-year pressures. These pressures were not limited to 2024- 25, with the vast majority recurring in future years. Compensation payments for victims of the Post Office Horizon IT and Infected Blood scandals had also not been fully accounted for. The government is providing compensation to the victims in full averaging £2.3 billion a year over the forecast period. There has additionally not been a Spending Review since 2021, so departmental budgets have not been systematically re-planned to account for the recent spike in inflation and other factors that have caused significant cost pressures. Plans set at Spring Budget 2024 were for day-to-day departmental spending to fall from 16.7% of GDP in 2023-24 to 16.0% in 2028-29 and for public sector net investment to fall from 2.5% of GDP in 2023-24 to 1.7% in 2028- 29. This was in the context of declining public service performance and GDP per capita lower than at the start of the last Parliament. The government is taking a different approach. Autumn Budget 2024 is: Putting the public finances on a sustainable path by strengthening the fiscal framework, including announcing new fiscal rules, and taking difficult decisions on tax, welfare and spending. Growing day-to-day departmental spending at an average of 2.0% per year in real terms between 2023-24 and 2029-30 to support public services, including to deliver 40,000 extra elective appointments a week and reduce NHS waiting lists. Boosting capital investment by over £100 billion over the next five years, including in transport, housing and research and development (R&D), with a greater focus on value for money and delivery to help unlock long- term growth. The Office for Budget Responsibility (OBR) has assessed the impact of the government’s decisions. In the OBR’s Economic and Fiscal Outlook, growth is forecast to increase to 2.0% in 2025 before moderating to 1.6% by 2029. Public sector net investment averages 2.6 % of GDP over the Parliament. The OBR judges that higher investment will add to GDP during the forecast period, and if sustained will increase the size of the economy in the long term. Strengthening the fiscal framework To support economic and fiscal stability, the government is confirming a set of responsible reforms to the fiscal framework that improve certainty, transparency and accountability. This includes announcing new fiscal rules: Stability rule : to move the current budget into balance, so day-to-day spending is met by revenues, and the government will only borrow for investment. Investment rule : to reduce net financial debt (public sector net financial liabilities) as a proportion of GDP. This rule keeps debt on a sustainable path while allowing the step change needed in investment, by capturing not just the debt that government owes, but also financial assets that are expected to generate future returns. This is the last year that the fiscal rules will target the fifth and final year of the forecast. The rules must be met by 2029-30 at this Budget, and until 2029-30 becomes the third year of the forecast, at which point both rules will target the third year of the rolling forecast period. The OBR confirms that the government is meeting the stability and investment rules. The current budget is in surplus and net financial debt falls as a share of the economy by 2029-30. Both rules are met early with the current budget in surplus from 2027-28 and net financial debt falling by 2027-28. Public sector net debt also falls as a share of the economy by 2029-30. The fiscal rules are set out in a new Charter for Budget Responsibility, which implements a more stable and transparent framework. This includes committing to one major fiscal event a year, more regular Spending Reviews, and improved sharing of departmental spending information with the OBR. Fixing the foundations The government is driving efficiencies and reducing wasteful spending. The Budget sets a 2% productivity, efficiencies and savings target for government departments and has formally launched the Office for Value for Money to realise benefits from every pound of public spending. The government will shortly appoint a Covid Corruption Commissioner. They will lead work to recover public funds from companies that took unfair advantage of government schemes during the COVID-19 pandemic. The government is reforming its approach to welfare, including setting a new welfare cap for 2029-30 with strengthened accountability, to support spending control and ensure that welfare spending is sustainable in the medium term. Fraud and error in the welfare system costs the government almost £10 billion a year. The government is cracking down on this with a package of measures saving £4.3 billion in 2029-30. The government will set out reforms to health and disability benefits early in 2025 to ensure the system supports people who can work to remain in or start employment, in a way that is fair and fiscally sustainable. The government is ensuring that tax that is owed is paid by introducing the most ambitious ever package to close the tax gap, raising £6.5 billion in additional tax revenue per year by 2029-30. Supporting people with the cost of living The government is boosting wages for the low paid by accepting the recommendations of the Low Pay Commission in full, meaning the National Living Wage will increase. This represents an increase of over £1,400 to the annual earnings of a full-time worker on the National Living Wage and is expected to benefit over 3 million low paid workers across the UK. To protect vulnerable people, the government will provide £1 billion, including Barnett, to extend the Household Support Fund and Discretionary Housing Payments in 2025-26, which will be used by local authorities to address immediate hardship and crisis. The government will maintain the State Pension Triple Lock for the duration of this Parliament. The basic and new State Pension will increase by 4.1% in 2025-26, in line with earnings growth, meaning over 12 million pensioners will receive up to £470 per year. Working age benefits will be uprated in full in 2025-26 by the September 2024 Consumer Price Index (CPI) inflation rate of 1.7%. The government is also creating a new Fair Repayment Rate, which caps debt repayments made in Universal Credit, allowing 1.2 million households to keep more of their Universal Credit award. The Carer’s Allowance weekly earnings limit will also be raised to improve financial security for carers to support them into work or to work more hours if they choose. Protecting working people Despite challenging fiscal circumstances and the need to raise additional revenue to repair the public finances, the government is protecting working people. The government has committed to not increase taxes on working people, which is why it is not increasing the basic, higher or additional rates of income tax, National Insurance contributions (NICs) or VAT. The government is freezing fuel duty and extending the temporary 5p cut for one year, at a cost of £3 billion next year, to support hard-working families and businesses. This will save the average car driver £59 in 2025-26. The government will not extend the freeze to income tax and National Insurance contributions thresholds. From April 2028, these personal tax thresholds will be uprated in line with inflation. Supporting businesses The government will deliver a fairer business rates system through permanently lower business rates multipliers for retail, hospitality and leisure (RHL) properties from 2026-27. The Budget also provides £1.9 billion of support to small businesses and the high street in 2025-26 by freezing the small business multiplier and providing 40% relief on bills for RHL properties, up to a £110,000 cash cap. To recognise the economic and cultural importance of British pubs, and commitment to supporting smaller brewers, the government is cutting alcohol duty on draught products from February next year, reducing it by 1 penny per average strength pint. Alcohol duty on non-draught products will increase in line with Retail Price Index (RPI) inflation from the same date. The government is supporting spirits producers, such as the Scotch Whisky industry, by removing mandatory duty stamps for spirits and increasing investment in the Spirit Drinks Verification Scheme, which allows producers to verify the geographic origin of their products. The government is providing stability and predictability to support businesses to invest by publishing a Corporate Tax Roadmap, which confirms that the government will cap the rate of Corporation Tax at 25%, the lowest in the G7, for the duration of the Parliament. Raising revenue to fund public services To repair the public finances and help raise the revenue required to increase funding for public services, the government is taking the difficult decision to increase the rate of employer NICs by 1.2 percentage points to 15%. The per‑employee threshold at which employers start to pay National Insurance will be reduced from £9,100 per year to £5,000 per year. These changes will apply from 6 April 2025. To support small businesses with these changes, the government is increasing the Employment Allowance from £5,000 to £10,500 and removing the £100,000 threshold, expanding this to all eligible employers. This means that 865,000 employers will pay no NICs next year. The Budget increases the lower rate of Capital Gains Tax (CGT) from 10% to 18% and the higher rate from 20% to 24%. This ensures asset owners pay their fair share whilst keeping the UK tax system internationally competitive, with lower rates than comparable EU countries. CGT rates for Business Asset Disposal Relief and Investors’ Relief will rise gradually to 14% from 6 April 2025 and match the main lower rate of 18% from 6 April 2026, to allow business owners time to adjust to the changes. The government is making the inheritance tax system fairer by applying inheritance tax to unspent pensions pots and restricting the generosity of agricultural property relief and business property relief for the wealthiest estates. To ensure Air Passenger Duty (APD) revenues remain sustainable, the government will adjust all APD rates in 2026-27, adding £2 for those flying economy to short-haul destinations. Higher rates for private jets will increase by 50% and the government is consulting on extending the higher rate to include more private jets. To help drive the transition to electric vehicles (EVs) the government is strengthening incentives to purchase EVs by widening the differentials in Vehicle Excise Duty First Year Rates between EVs and hybrids or internal combustion engine cars. The government is also maintaining EV incentives in the Company Car Tax regime and extending 100% First Year Allowances for zero emission cars and EV chargepoints for a further year. Delivering on tax commitments The government is delivering on its commitments to make the tax system fairer and raise revenue to fund public services. The Budget is closing loopholes in the tax system, including ending the unfair current treatment of carried interest and replacing the non-dom tax regime with a new residence-based system to make sure that everyone who makes their home in the UK pays their taxes here. The government is supporting first-time and main home buyers by increasing the Higher Rates for Additional Dwellings in Stamp Duty Land Tax on the purchases of second homes, buy-to-let residential properties, and companies purchasing residential property, from 3% to 5% from 31 October 2024. To help make the UK a clean energy superpower, oil and gas companies will contribute more to support the energy transition. The government is increasing the rate of the Energy Profits Levy (EPL) from 35% to 38%, removing the 29% investment allowance, and extending the levy until 31 March 2030. To provide certainty and to support a stable energy transition, 100% first-year allowances in the EPL will remain and the government will consult in early 2025 on how the oil and gas tax regime should respond to price shocks once the EPL ends in 2030. To help fund the government’s priorities for education and young people it is delivering on its commitment to charge VAT on private school fees and to remove business rates charitable relief in England. Fixing the NHS and reforming public services Through Phase 1 of Spending Review 2025 the government is resetting public spending for 2024-25 and setting departmental budgets for 2025-26. The government is providing an additional £22.6 billion of resource spending in 2025-26, compared to 2023-24 outturn, for the Department of Health and Social Care. This will support the NHS in England to deliver an additional 40,000 elective appointments a week and make progress towards the commitment that patients should expect to wait no longer than 18 weeks from referral to consultant-led treatment. The government is boosting capital investment in public services in 2025-26 including £1.5 billion to deliver capacity for more than 30,000 NHS procedures, over 1.25 million more diagnostic tests and new beds across the NHS estate, and £1 billion to reduce the backlog of critical NHS maintenance, repairs and upgrades. The government is also investing £1.4 billion to help rebuild schools, £1.2 billion to deliver extra prison places, and almost £1.6 billion in local roads maintenance. The government is delivering on its other first steps, including supporting recruitment of 6,500 new teachers in England through a £2.3 billion increase to the core schools budget, launching Great British Energy and a new Border Security Command, and cracking down on antisocial behaviour by supporting neighbourhood policing. The Budget fixes the envelope for Phase 2 of the Spending Review, which will deliver a new mission-led, technology-enabled, and reform-driven settlement for public services. The Spending Review will conclude in late spring 2025. Rebuilding Britain The government is delivering its growth mission by prioritising stability, investment and reform to drive prosperity across the UK. The Budget takes the difficult decisions to put the public finances on a sustainable path to create the conditions for growth. Supported by the new fiscal framework, the Budget increases public investment by more than £100 billion over the next five years to boost growth and help crowd in private investment in the long run. Capital investment will increase by £13 billion next year, taking total departmental capital spending to £131 billion in 2025-26. This includes investing in transport, kickstarting the delivery of 1.5 million homes, supporting new industries and job creation, and protecting record R&D funding. The Budget also increases investment in public services, recognising that a well-functioning NHS and education system are critical to the economy. With new guardrails that will govern the approach to capital spending, and new and strengthened institutions, the government is reforming the way it plans, assures, delivers and evaluates capital spending. These changes will provide greater certainty for departments, investors and supply chains, and greater assurance that investment achieves value for money, is well delivered and supports growth. The government will work in partnership with the private sector to further increase investment. The government has created the National Wealth Fund to catalyse over £70 billion of private investment, set out plans for a modern Industrial Strategy to support investment in growth-driving sectors, and launched a pensions review to unlock greater investment in UK growth assets. The government is making the reforms needed to deliver sustained growth in the long-term. These include ambitious planning reforms to remove barriers to growth, the development of a 10-year infrastructure strategy to be published alongside Phase 2 of the Spending Review, the forthcoming publication of the Get Britain Working White Paper, and the establishment of Skills England to ensure we have the highly-trained workforce needed to deliver economic growth. The government’s growth policy priorities, under the framework of stability, investment and reform, have been structured into seven pillars, as illustrated in chapter 3. These priorities are being taken forward in partnership with business, and backed by a continuous focus on delivery supported by a Growth Delivery Unit established in HM Treasury. Autumn Budget 2024 is fixing the foundations of the economy and beginning a decade of national renewal. The government is protecting working people, fixing the NHS, and boosting investment to deliver growth and prosperity for all parts of the country.

Buy to let - invest for profit! With the property market booming you might be thinking about investing in property to let. High rental yields might appear to provide a safe investment opportunity. What might be the returns and how would they be taxed? On the bandwagon? It’s not just London and the South-East where the property market is booming. A major property agent is selling 60 to 70% of its new developments in Leeds, Manchester and Birmingham to investors. And we’re not talking about property tycoons either - just ordinary people who’ve seen the potential rewards to be made from property. Fund it Unless you’ve got excess cash sloshing around you’ll probably need to take out a second mortgage to purchase the property. Several lenders now specialise in this market and will lend between 75% and 85% of the purchase price. You could try Mortgage Express, Northern Rock, Birmingham Midshires or Britannia. Shop around as there are deals, such as interest holidays, to be had. Most will not take your existing mortgage and credit commitments into account. But they will need to be satisfied that the anticipated rental income will cover the monthly mortgage payments and the ongoing costs of maintaining the property, etc. To keep the interest payments to a minimum you should take an interest only mortgage then redeem the loan by either selling the property once it’s risen in value or make annual lump sum repayments from the letting profit. How much? Naturally a “commercial” mortgage is likely to cost slightly more than a purely residential one. Expect to pay a premium of between 0.25% and 0.50% on top of the normal variable interest rate. At current rates this might mean a mortgage at 7.50%. If you borrow say £80,000 to fund the purchase of a £100,000 property, the monthly interest payment would be £500. This means you’ll need to show the lender that you’ll be able to net at least this amount. In gross terms we reckon that the monthly rental you’d have to charge would be around £700. Expect to pay a property managing agent15% (£105) and pay around 10% into a fund to cover things like insurance, property maintenance and periods when it’s not occupied. If you let the property for £1,000 per month (four tenants each paying £250), after deducting these sums and the mortgage interest you’d still net £250. Tax too! OK, so it’s easy to see how rented property can generate a healthy income. But of course the taxman will want a slice of it! The tax position for rental properties is broken into two parts. 1. Income tax is payable on the profit generated each year after deductions for the ongoing expenses have been made. The taxman will generally offset mortgage interest payments, ground rent, service charges, management fees, repairs and up to 10% depreciation from the gross rental income before calculating the income that you’ll have to pay tax on. Tip. Making capital purchases e.g. a new cooker is not an allowable expense. But the cost of repairing the cooker would be - so make sure you keep receipts for all repairs. 2. Capital gains tax (CGT) is calculated on the gain made when the property is sold after allowing for your annual CGT exemption in the year of disposal (currently £7,100). A complicated formula for tapering relief on gains has also been introduced by the Chancellor - check the exact position with your accountant before selling. Tip. If you purchase the property jointly with your spouse you can claim two sets of CGT exemptions against the property sale proceeds. Before you buy make sure that the property will generate a rental income at least 50% higher than the mortgage payment. Shop around for a competitive mortgage quote and keep receipts for all repairs.

Analysing profit Every year when you meet with your accountant, he tells you that the company has had another good year and made a substantial profit. If that’s the case, why is it such a struggle to find the cash to pay the tax bill? Accountants’ profit The Profit & Loss Account (P&L) that your accountant prepares shows the financial performance of your business over a given period (usually a year) and indicates whether or not your business is making any money. The P&L is also used to calculate your tax bill. Your accountant works out your profit by adding up all your sales for the year and subtracting your business expenses from them. He then makes a few accounting adjustments to arrive at the “bottom line” - the net profit for the year. It can come as quite a surprise to find out you’ve made a profit and have to pay tax when you’ve got an even bigger overdraft than last year. Before you start blaming your accountant, read on... Profit is not cash It is very important to remember that profit is not the same as cash. Why? Perhaps the most common reason is the difference in timing between making a sale or purchase and actually receiving or paying the money. For example, you made a sale in February but your customer didn’t pay until April. If your accounts are prepared to March 31 each year, then the sale will be included in the profit but the money won’t be banked until the following year. So, even if you’re owed money at the year-end, you’ll have to pay tax on it. Tip. Review your year-end debtors and make a list of debts that are unlikely to be paid. A provision for these can be made in your accounts which will reduce your profit and therefore your tax bill. Matching Your accountant makes certain adjustments so that income and expenses are matched to the year(s) they relate to, not the year they are received or paid. Some of these adjustments can result in large differences between profit and cash: Stock At the year-end, you may have a lot of cash tied up in goods that haven’t been sold yet. The cost of this “closing stock” is not included in your P&L expenses as it cannot be matched to sales. Tip. When working out your closing stock figure, don’t include the cost of old stock that you can’t sell. It has no value. The smaller the closing stock figure, the smaller your profit and the smaller your tax bill. Depreciation If you bought a car for £8,000, you may be surprised when it doesn’t show up on your P&L. Instead, depreciation is calculated and shown as an expense on the P&L. The depreciation rate depends on the useful life of the asset but it’s usually 25% of the cost each year so the depreciation on the car would be £2,000 a year for four years. Therefore, in the year you buy the car, the profit would be £6,000 higher than the cash. Drawings If you’re self-employed, your cash drawings do not affect your profit. It’s a common misconception that you are taxed on your drawings. You’re not. You’re taxed on your profit so it makes no difference if you leave the money in the business or transfer it to your private account. Just make sure you put enough aside (at least 25%) to pay your tax bill (the tax due on a profit of £3,000 a month is over £9,000). Profit doesn’t always mean more cash. The main reason is the timing difference between invoicing and getting paid. A provision for year-end debtors will reduce profits and therefore your tax bill.

If you employ even one member of staff you need to set up a payroll. There are many rules to be complied with so you might be tempted to let someone else take care of it. But could you do it yourself? Payroll basics Whether you’re about to set up a payroll for the first time or if you’re upgrading your existing system, it helps to know what you’re supposed to know. And if you use a payroll bureau without knowing what’s involved, you might be surprised how easy it can be - and decide to do it yourself. Register with your local tax office. You’ll receive a PAYE reference and a pack of information including tables for calculating the deductions. Maintain payroll information for each employee - NI number, date of commencement, rate and frequency of pay, the employee’s tax code. List all wage payments. This is often done on form P11 which is used to calculate the tax due from each employee and the amount of NI that you’ll both have to pay. Make additional deductions, e.g. to a pension fund. These are normally only with the employee’s consent. Issue P45s to employees when they leave. Manual calculations? If you run a small business you can operate a manual payroll system. This is not as easy as you might think. Everything has to be recorded and calculated manually. This might be OK if you already employ the services of a competent and numerate bookkeeper but if you’re just about to establish a payroll we’d advise against this method. The fine for sending in the wrong information could be £3,000 per employee! Auto makes sense Most businesses prefer to automate payroll. This effectively leaves you two choices - 1) do it yourself using some specialist computer software or 2) pass the entire responsibility to a payroll bureau or a firm of accountants. Costly. A major payroll bureau that we contacted quoted £6.50 per employee per month. For 10 employees this could mean £780 p.a. plus VAT. Accountants might well be cheaper and certainly worth considering if keeping sensitive payroll information off site is important. If a firm already looks after your business, adding the payroll function is unlikely to add more than a few hundred pounds to the annual bill. A software package like that available from Sage or Pegasus will start at around £200 (rising to approximately £350 for up to 100 employees). However, you will of course have to factor in the cost of your time (or another employee’s) needed to operate it. The purchase price is a one-off payment. Whereas with a payroll bureau fees will rise as new employees join. Tip. Contact your accountant to see whether he can handle your payroll for only a marginal increase in the fees you pay. Decisions, decisions The real questions are whether you’re prepared to lose control of payroll and whether you have the existing resource to be able to manage it in-house. On the resource side, once all the employee information has been entered into your computer, it will require no special skills or huge amount of time to operate the payroll - we reckon no more than a couple of hours per month. It’s really only a question of keeping the information up to date. For example if an employee is off sick you simply mark the dates on the calendar supplied with the software - the computer will then calculate whether pay is due and at what rate, including SSP. It will also generate all the vital year end forms needed such as P11Ds and P14s. Although a manual payroll system is not for the fainthearted there could be savings to be made by investing in a software package. Alternatively, see if your accountant can do the work for a marginal increase in his annual fee.

Every year when you meet with your accountant, he tells you that the company has had another good year and made a substantial profit. If that’s the case, why is it such a struggle to find the cash to pay the tax bill?

Late payments can severely threaten your cash flow, and ultimately the survival of your business. Last year, almost over 50% of businesses were forced to take the no-nonsense approach of suspending work and services for those who owed them money, according to Our Late Payment Survey. The survey showed the negative effects of tardy payments all too clearly, revealing that over 50% of the businesses surveyed had to make at least one employee redundant last year as a direct consequence of late payments. Stopping your services is certainly one way of making your feelings about late payments known, but it doesn’t do much for already-strained professional relationships. So, what are your alternatives? Well, you may legally be entitled to charge interest on any money you’re owed. This gives you the right to claim interest from a customer who fails to pay its bills on time. Instead of relying on the law, you can make your own arrangements in your contracts in relation to charging interest on late payments. Often, explaining that you plan to charge interest on any overdue payments can be enough to get a speedy payment out of your debtors. Before it comes to that, make sure that it’s easy for your customers to pay on time. Offer fast and simple payment methods, including Cash in hand, direct debits, standing orders and payment before receipt of goods or provision of services to make it less of a chore for them. For more advice and guidance, contact us about How do I apply interest on late payments briefing.

Now that coronavirus-related restrictions are starting to be eased, inspectors are heading out again. Who is on their radar? Enforcement. The Scottish Environment Protection Agency (Sepa) has said there will be an increasing number of enforcement staff on the ground in the coming weeks as more people are vaccinated and restrictions due to coronavirus are eased. It’s a fair bet that the Environment Agency (EA) in England will be doing the same. Constraints. Staff who respond to incidents are classified as key workers and have therefore been permitted to travel to do their job during lockdown. But regulators across the UK have taken an extremely cautious approach with most enforcement officers restricted to desk-based duties. They have been reacting to many incidents and providing advice remotely, which campaigners have said isn’t working. In the dark. It’s also worth noting that in Scotland Sepa has also been hit by a cyber attack. This happened on Christmas Eve 2020 and months later 30% of staff still don’t have email. Permits etc. have been extended and many routine checks and advice stopped. These are gradually returning. More police. Don’t expect to see hordes of enforcement staff as lockdown restrictions are lifted. While coronavirus has hamstrung their enforcement activities, there has been a decline in policing over a number of years due to budget constraints. Targets. Those that are out will be targeting the sites and businesses they see as higher risk, including those they have had on their radar as struggling or failing to comply with regulations, permits, etc. Tip. Checks have been few and far between for the past year but they will certainly increase in 2021. The regulators will also be out to prove that their “smarter” approach to regulation - with fewer boots on the ground - is working. Compliant businesses have nothing to worry about so make sure your paperwork etc. is in order. Although enforcement officers are back to full duties, their numbers are low. This means only high risk sites and those identified as breaching permits etc. will see them. If you keep on top of compliance, you’ll avoid a visit.

The rules for off-payroll working changed in April 2021. If they apply to someone who works for you, or you are the worker, there are new payroll and self-assessment reporting requirements. How might they affect you? Off-payroll and RTI. The long-awaited changes to the off-payroll working (IR35) rules took effect on 6 April. HMRC is reminding businesses and other organisations that are or will apply the rules to contractors who work for them, that payments made on or after 6 April 2021 are only affected if the work in question was carried out on or after that date. Tip. If you’re a contractor and the business or organisation you work for is applying the off-payroll rules to your contract, make sure that if you send an invoice covering work done both before and after 6 April you specify the values for each. Payroll indicator for payers. When including payments you make to a contractor for off-payroll work in your payroll you must use the “off-payroll worker subject to the rules” indicator in your PAYE RTI reports (full payment submission) (FPS). The name of the indicator might be different depending on what payroll software you use, however it should be easy to spot. Warning. If you use, or have used, the indicator for a payment when you shouldn’t have, HMRC is asking that you urgently send a corrective FPS for the relevant payroll period. Off-payroll workers. If you’re a contractor and are applying the off-payroll rules to payments you receive from a customer (rather than your customer applying them), you must not use the off-payroll indicator mentioned above. HMRC is especially adamant about that. Self-assessment. If your customer is applying the off-payroll rules and you’re repaying a student loan, you should make sure that you’re registered for self-assessment to ensure that HMRC calculates the correct loan repayment. When reporting PAYE and NI for a worker made under the off-payroll rules you must use the special indicator in your payroll software. The rules don’t apply to payments made after 6 April 2021 that relate to work done earlier.

As the restrictions on foreign travel are lifted, many employees are planning to go abroad. If they are required to quarantine on their return to the UK what are their pay rights? Green, amber and red. In relaxing the rules on foreign travel, the government has introduced a traffic light system. This allows people in England to holiday abroad in “green” list countries. Travel to “amber” and “red” list countries is restricted, but an employee may have a valid reason for travelling there. Countries and territories can be moved between lists if conditions change, e.g. a green list country could turn amber and an amber country could turn green. Mandatory ten days. Those who visit amber or red list countries are legally required to quarantine on their arrival back in the UK and you can’t require them to attend your workplace during this time. Also, it’s possible that an employee who has visited a green list country could be required to quarantine because they’ve travelled with a person who has tested positive for COVID-19. Where an employee is legally required to quarantine, what are their rights in relation to pay? Pay rights. Ultimately, this will depend on what the employee can do during the quarantine period. If they can work from home, then you must pay them as normal. Where this isn’t possible due to the employee’s job role, you aren’t obliged to pay them. This is because the employee isn’t able to fulfil the terms of their employment contract during the quarantine period. You could, however, allow them to take the time off as annual leave or a mixture of annual leave and unpaid leave. Tip. Where an employee is required to quarantine on their arrival back in the UK, they have no right to receive statutory sick pay (SSP) unless they have COVID-19 symptoms. To avoid any misunderstandings, ensure that your employees know what their rights are to pay during any period of quarantine before they travel outside of the UK. Where the employee can work from home, they must be paid their normal pay during quarantine. If this isn’t possible, they have no right to pay but could take annual leave. Statutory sick pay is only payable if they have COVID-19 symptoms.