In the UK, statutory payments form an essential part of our social security system. They provide financial support to employees during specific life events or periods of illness. Administered by HM Revenue & Customs (HMRC), these payments ensure that employees receive financial assistance when they are unable to work due to various circumstances.

Understanding the rules and regulations surrounding statutory payments is crucial for both employers and employees. So, we’re delving into the details of Statutory Sick Pay (SSP), Statutory Maternity Pay (SMP), Statutory Paternity Pay (SPP), and Statutory Adoption Pay (SAP). In doing so, we hope to shed light on their many benefits and advantages.

Statutory Sick Pay (SSP)

Statutory Sick Pay (SSP) is designed to provide financial support to employees who are unable to work due to illness. To be eligible for SSP, employees must meet specific criteria. This includes earning a minimum amount and being off work due to illness for at least four consecutive days. Employees can receive SSP for up to 28 weeks.

SSP provides a safety net for employees who are unwell and unable to work. It ensuring that they continue to receive a portion of their income during their absence from work. Employers are required by law to provide SSP to eligible employees. That is, they must offer a level of financial protection to their workforce in the event of sickness.

Statutory Maternity Pay (SMP)

Statutory Maternity Pay (SMP) is available to pregnant employees who meet specific eligibility criteria. This includes having been continuously employed by the same employer for at least 26 weeks by the end of the 15th week before the expected due date and earning above the prescribed lower earnings limit.

SMP ensures that eligible employees receive financial support during their maternity leave. This allows them to focus on their well-being and the care of their newborn without worrying about financial instability. Employers are legally required to provide SMP to eligible employees. This demonstrates their commitment to supporting their staff during significant life events such as childbirth.

Statutory Paternity Pay (SPP)

Statutory Paternity Pay (SPP) is available for eligible employees who take time off work to care for their child or to support the mother. This payment helps employees strike a balance between work and family life, contributing to a positive work-life balance.

SPP acknowledges the importance of fathers and partners in providing care and support to the mother and child. So, SPP allows them to take time off work without experiencing undue financial hardship. SPP also plays a crucial role in promoting equality in parental leave. It gives fathers and partners the opportunity to bond with their child during the early stages of parenthood.

Statutory Adoption Pay (SAP)

Statutory Adoption Pay (SAP) provides financial support to employees who are adopting a child. To be eligible, employees must have been continuously employed by the same employer for at least 26 weeks by the end of the week they are matched with a child and earn above the lower earnings limit.

SAP ensures that adoptive parents have the financial support they need during the adoption process and the crucial period following the arrival of their child. This is designed to alleviate financial concerns during this significant life event. By providing financial assistance to employees who are adopting a child, SAP contributes to creating a supportive environment for adoptive parents, encouraging and promoting the adoption process within the workforce.

In Conclusion

Statutory payments such as SSP, SMP, SPP, and SAP play a crucial role in supporting employees during significant life events and periods of illness. These payments provide essential financial assistance, contributing to the welfare of employees and fostering a supportive and inclusive workplace environment.

Employers have a legal obligation to administer these payments in accordance with the relevant regulations, demonstrating their commitment to the well-being of their workforce and compliance with statutory requirements.

Understanding the rules and benefits of these statutory payments is essential for both employers and employees to ensure that eligible individuals receive the support they need during critical moments in their lives. If you would like any assistance with statutory payments or better yet to remove the concern and burden of meeting these requirements, talk to us today. Lewis Brownlee offer a managed payroll service and take care of the above along with the other complexities and requirements of Payroll.

If you’d like to speak to one of our experts about, please call 01243 782 423, or email from our contact page and we will be in touch!

We also update our YouTube Channel regularly with new content, see here: Lewis Brownlee YouTube channel.

The Generic Notification Service (GNS) from HMRC serves as a vital communication channel through which employers receive various types of official notifications and correspondence related to their tax obligations. When it comes to payroll and employment matters, HMRC utilises the GNS to keep employers informed about a range of topics. Here are the types of information that employers may receive through the GNS:

Pay As You Earn (PAYE) Reminders and Deadlines:

• HMRC uses the GNS to send reminders about important PAYE deadlines, such as submission deadlines for payroll reports, including Real Time Information (RTI) submissions.
• Notices about important PAYE-related updates or changes in legislation that may impact how employers report and pay their employees’ taxes.

Tax code Changes

• Employers will receive tax code notices, in the form of P6 and P9 forms, which will contain all the relevant information to update an employee’s tax code.

Student Loan and Postgraduate Loan Notices

• Employers also receive Student Loan and Postgrad Loan notices via the system, also known as SL1 and PGL1 forms, which like the tax code notices contain the details of plan numbers and start dates.

National Minimum Wage (NMW) and National Living Wage (NLW) Updates:

• Notifications regarding changes in the National Minimum Wage and National Living Wage rates, ensuring that employers are aware of the new minimum wage requirements for their workforce.

Compliance Reviews and Investigations:

• Employers may receive notifications about compliance reviews or investigations, including National Minimum Wage (NMW) investigations, to inform them about HMRC’s intention to scrutinize their payroll and employment practices.

Employment Allowance Information:

• Communication regarding updates to the Employment Allowance, a relief that allows eligible employers to reduce their National Insurance contributions.

Statutory Payments:

• Information related to statutory payments, such as Statutory Sick Pay (SSP), Statutory Maternity Pay (SMP), Statutory Paternity Pay (SPP), and Statutory Adoption Pay (SAP).

Real Time Information (RTI) Updates:

• Guidance or notifications about changes to Real Time Information (RTI) requirements, ensuring that employers are kept informed about reporting obligations under the RTI system.

Identification of Unpaid Taxes or Under-Declared Income:

• Notifications about potential discrepancies, unpaid taxes, or under-declared income based on the information provided by employers, prompting further investigation or clarification.

Employers must treat any communication received through the Generic Notification Service (GNS) from HMRC with the utmost diligence and attention. This includes promptly addressing any requests for information and responding to all compliance reviews. So too, they must ensure that payroll and employment practices align with the latest regulatory requirements. Staying informed about the information communicated through the GNS is crucial to maintaining compliance. It is also essential to fulfilling tax obligations in a timely and accurate manner.

At Lewis Brownlee, our payroll team process these notifications on a daily basis. As such, our clients are kept informed at all times of the changes that will affect them and their business. So, if you want to take the strain of payroll away, speak to us today! We offer a free, initial meeting so that you can find out what we do and how we do it. We’re a friendly bunch with the expert knowledge you need. So, when you’re ready, we’re ready! Call us at one of our three amazing offices today and lets see how we can partner in your success!

Chichester: 01243 782 423
Midhurst: 01730 817 243
Whiteley: 01489 287 782

If you’d like to speak to one of our experts about, please call 01243 782 423, or email from our contact page and we will be in touch!

We also update our YouTube Channel regularly with new content, see here: Lewis Brownlee YouTube channel.

At Lewis Brownlee, we understand the complexities and challenges that come with handling payroll. Many businesses consider running their own payroll to cut costs and maintain control, but the reality is often quite different. So why should you outsource your payroll and what are the benefits and advantages it offers?

Let’s take a quick look!

Expertise and Compliance

Managing payroll requires a deep understanding of ever-changing tax laws, employment regulations, and compliance requirements. It’s not just about crunching numbers. It’s also about staying abreast of legislative updates and ensuring that your payroll practices align with the latest standards. Outsourcing means tapping into a pool of expertise.

Here at Lewis Brownlee, we are well-versed in payroll laws and compliance. So, we can reduce the risk of errors and penalties while also navigating complex tax codes, deductions, and benefits with ease. In short, we can ensure that your business remains in full compliance.

Time and Efficiency

Running payroll can be time-consuming, especially for small businesses with limited resources. It involves meticulous data entry, calculations, and constant vigilance to ensure accuracy. Outsourcing payroll frees up valuable time, allowing you to focus on core business activities. For example, we have streamlined processes and advanced payroll systems that can automate many tasks. This means saving you time and reducing the likelihood of errors. This level of efficiency not only simplifies the payroll process but also eliminates the stress associated with last-minute calculations and deadlines.

Cost-Effectiveness

Contrary to popular belief, outsourcing payroll can be a cost-effective solution. Consider the resources required to maintain an in-house payroll department: staff salaries, software, training, and the potential cost of mistakes. By outsourcing, businesses can access high-quality payroll services at a fraction of the cost, without the burden of managing an internal payroll team. In addition, the potential savings from avoiding penalties or fines resulting from payroll errors can far outweigh the cost of outsourcing.

Enhanced Security and Confidentiality

Payroll data is sensitive and confidential. Mishandling or inaccuracies in payroll processing can lead to legal and financial repercussions. We understand the importance of safeguarding this information and have procedures in place to ensure data security and confidentiality. Businesses can benefit from our secure data management, reducing the risk of breaches and unauthorised access.

Access to Advanced Technology

We invest in state-of-the-art payroll software and technologies to deliver efficient and accurate services allowing you to leverage these cutting-edge tools without the need for significant investment. These systems are designed to handle complex payroll calculations, generate detailed reports, and provide insights that can inform strategic decision-making.

In conclusion, the decision to outsource payroll should be seen as an investment in efficiency, accuracy, and compliance. By leveraging the expertise of our payroll professionals, you can streamline your payroll processes, minimize risks, and redirect valuable resources to growing your core operations. At Lewis Brownlee, we understand the complexities of payroll management and are committed to delivering tailored solutions that meet the unique needs of each client. If you’re ready to experience the benefits of outsourcing your payroll, contact us today to learn how we can support your business.

If you’d like to speak to one of our experts about, please call 01243 782 423, or email from our contact page and we will be in touch!

We also update our YouTube Channel regularly with new content, see here: Lewis Brownlee YouTube channel.

Receiving a letter from HMRC informing you of a National Minimum Wage (NMW) investigation can be daunting. It can often be a nerve-wracking and concerning experience for any company. Whether intentional or unintentional, NMW violations can lead to significant financial fines. Moreover, they can seriously harm a business’s reputation due to the possibility of public exposure as a non-compliant employer. The consequences of failing to comply with NMW regulations should not be underestimated. Last year alone, M&S, Argos and WH Smith were all names HMRC listed amongst 200 employers who failed to pay the National Minimum Wage.

Whilst many of these employers maintained the breaches were unintentional, fines were still issued by HMRC. Some were potentially as high as 200% of the arrears owed! As such, it is incredibly important to familiarise yourself with the rates and rules surrounding NMW. Only then can you minimise the risks of being caught out.

The rates and the rules…

The National Minimum Wage (NMW) and the National Living Wage (NLW) are the minimum hourly rates that must be paid to workers in the UK. The rates are reviewed annually and are currently set as follows:

23 and over – £10.42 per hour (NLW)

21 to 22 – £10.18 per hours

18 to 20 – £7.49 per hour

Under 18 and Apprentice – £5.28 per hour.

These rates are set to ensure that all workers receive a fair wage for their labour and to prevent exploitation. The new rate system is due to change in April 2024. This will remove the 21-22 band altogether and increase the rates across the board. They will be as follows:

21 and over – £11.44 per hour (NLW)

18 to 20 – £8.60 per hour

Under 18 and Apprentice – £6.40 per hour

NMW Compliance

HMRC’s investigations can be long, drawn-out, and protracted affairs. They often take years to conclude and can draw input from current and former workers. HMRC often bases its assessment of NMW violations on worker testimony or projections from “best fit” samples when exact records are unavailable. This often puts employers in a difficult position with limited recourse.

The onus of proving compliance weighs heavily on the employer. Non-compliance can result in significant consequences. In the large majority of breaches, it isn’t as simple as a worker being paid the wrong hours rate. In the case of WH Smith, for example, they were found to have breached the legislation as they required their employees to wear specific coloured trousers, skirt and shoes and didn’t reimburse their staff for purchasing them.

What does it mean for businesses?

For businesses, managing the complexities of NMW and NLW compliance is a significant challenge. It requires meticulous record-keeping and a deep understanding of the ever-changing regulations. Small businesses, in particular, may find it difficult to keep up with the administrative burden. Often, they lack the resources to navigate through NMW investigations with ease. This can lead to unintentional breaches and the subsequent anxiety when faced with the potential consequences.

So what are the best steps to take to avoid sleepless nights?

To minimise the risk of NMW breaches, employers should stay informed about the latest legislation and ensure their payroll systems are up to date. Conducting regular audits of pay records and seeking professional advice can also help to identify and rectify any potential issues before they escalate into full-blown investigations.

Employees, on the other hand, should familiarise themselves with their rights regarding the NMW and NLW. It’s crucial for workers to understand their entitlements and to speak up if they suspect that they are being paid less than the minimum wage they are entitled to. By being proactive and informed, employees can play a role in ensuring that they are fairly compensated for their work.

The current debate…

The ongoing discussion around the adequacy of the National Minimum Wage and the National Living Wage is essential. While these regulations are designed to protect workers from exploitation, there is ongoing debate about whether the current rates are sufficient to provide a decent standard of living, especially in areas with a high cost of living. As the economy and living costs continue to change, there are calls for regular and meaningful adjustments to the NMW and NLW to ensure that workers can lead a dignified life without struggling to make ends meet.

In short…

The National Minimum Wage and the National Living Wage have undoubtedly brought positive changes to the labour market by ensuring fair compensation for workers. However, the complexities and potential consequences of non-compliance can cause anxiety for both employers and employees.

It’s crucial for businesses to diligently manage their payroll processes and for employees to stay informed about their rights to mitigate the risks associated with NMW and NLW. Additionally, ongoing dialogue and evaluation of the adequacy of these minimum wage rates are essential to ensure that they continue to serve their intended purpose of enabling workers to lead a decent life.

At Lewis Brownlee, we have a dedicated Payroll team who can take the difficulty out of handling NMW for you. So, if you would like to find out more, please do get in touch. We offer a free, introductory meeting so that you can find out what we do and how we do it. And, as ever, we always look forward to seeing how we can partner in your business success!

If you’d like to speak to one of our experts about, please call 01243 782 423, or email from our contact page and we will be in touch!

We also update our YouTube Channel regularly with new content, see here: Lewis Brownlee YouTube channel.

As we move through February, UK businesses are presented with a unique opportunity to develop and/or refine an Effective Payroll Strategy. This month is pivotal; it’s the last full month before the end of the financial year. It’s a time for foresight and planning, ensuring that payroll systems are not only compliant but primed for the year ahead. Here’s some pointers to consider:

Payroll Review and Reconciliation

Ensuring Accuracy and Compliance

Now is the time to conduct thorough payroll audits. Ensure all records are accurate and reflect the correct payments, deductions, and contributions for the past year. This diligence is crucial for HMRC compliance and sets a clear benchmark for the new fiscal year.

Updating Employee Details

Confirm that all employee data, including personal details and tax codes, are up to date. Discrepancies can lead to errors and penalties, which can be avoided with a proactive review.

Legislative Updates and Training

Staying Informed on Changes

February is the ideal month to get ahead on legislative changes that will take effect from April 6th. Whether it’s adjustments to pension contributions or tax thresholds, an “Effective Payroll Strategy” incorporates these updates well in advance.

Investing in Training

Prepare your payroll team with training on any new software features or legislative requirements. Knowledge is power when it comes to managing complex payroll systems effectively.

Technology Integration and Optimisation

Leveraging Payroll Software

With the right payroll software, you can streamline operations and enhance accuracy. This month, review your software’s capabilities and plan for any necessary upgrades or integrations.

Forward-Facing Financial Planning

Strategic Financial Forecasting

Use this period to align payroll strategy with your business’s financial forecasting. Understanding the fiscal responsibilities for the coming year is essential in developing a robust payroll strategy.

Lewis Brownlee: Your Partner in Payroll Excellence

February’s strategic importance in payroll cannot be overstated. It’s a time to ensure that your business is not just reacting to changes, but actively preparing for them. At Lewis Brownlee, we specialise in crafting “Effective Payroll Strategies” tailored to your business’s needs. So, our expertise can ensure that your payroll operations are a seamless success, both now and in the future. If you are at all concerned by your payroll and would like to find out more about how we can help, please do get in touch. We offer a free initial meeting so that you can meet us and find out what we do and how we do it. So, there really is nothing to lose!

Call us today at one of our three offices and let’s see how we can partner in your success!

Chichester: 01243 782 423

Midhurst: 01730 817 243

Whiteley: 01489 287 782

If you’d like to speak to one of our experts about, please call 01243 782 423, or email from our contact page and we will be in touch!

We also update our YouTube Channel regularly with new content, see here: Lewis Brownlee YouTube channel.

Salary sacrifice benefits have become a popular choice for employers looking to provide added perks to their employees. This approach involves an employee agreeing to a reduction in their salary in exchange for certain benefits. While this can be a straightforward process in theory, there are several factors that can complicate matters. That’s why we have decided to explore the potential complexities involved in implementing salary sacrifice benefits. Hopefully, in doing so, we can highlight some common traps that employers fall into.

The incentive…

The concept of salary sacrifice benefits gained popularity with the support of government-backed initiatives. Employers were incentivised to provide specific benefits to employees that were favoured in terms of income tax and National Insurance contributions (NIC) but only if provided by the employer. These benefits included childcare vouchers, creche/nursery facilities and more. The approach was designed to encourage employers to support their employees’ well-being while also receiving tax and NIC benefits. Offerings typically offered today include:

• Electric Vehicle Scheme
• Cycle to Work Scheme
• Tech Purchase Scheme
• Workplace Nursery Scheme

All the above are excellent choices and employers would be helping employees’ finances significantly in some cases. In theory, adjusting an employee’s salary through payroll and providing the agreed-upon benefit seems like a logical and uncomplicated process. However, in practice, there are a number of potential pitfalls that employers should be aware of when implementing these benefit arrangements.

The pitfalls to consider…

Compliance

One of the key challenges employers face is ensuring compliance with the complex rules governing salary sacrifice arrangements. These rules can be difficult to navigate, especially when it comes to ensuring that the arrangements meet the specific requirements set forth by the government. Failure to adhere to these guidelines can result in financial and legal repercussions for employers, making it crucial to fully understand and comply with the rules.

Administrative burden

Additionally, the administrative burden associated with managing salary sacrifice benefits should not be underestimated. Employers must have robust systems in place to accurately process and document the salary adjustments, benefits provision, and related tax and NIC implications. Failing to properly manage these administrative tasks can lead to errors, compliance issues, and disgruntled employees.

Communication

Another potential complication arises from the need to effectively communicate the details of the salary sacrifice benefits to employees. Clear and transparent communication is essential to ensure that employees fully understand the impact of participating in these arrangements. Misunderstandings or lack of clarity can lead to dissatisfaction among employees and undermine the intended benefits of the program.

Pension Contributions

Furthermore, there may be unforeseen consequences associated with salary sacrifice benefits, particularly in relation to pension contributions and other financial matters. Employees who participate in salary sacrifice arrangements may inadvertently reduce their pension contributions, impacting their long-term financial planning. Employers need to proactively address these potential consequences and provide clear guidance to employees to help them make informed decisions.

Conclusion

While salary sacrifice benefits offer a valuable way for employers to provide attractive perks to their employees, it’s important to be aware of the potential complexities and pitfalls involved in implementing these arrangements. From navigating complex rules and administrative burdens to ensuring effective communication and addressing unforeseen consequences, employers need to approach salary sacrifice benefits with careful consideration and thorough planning.

By being proactive and diligent in addressing these potential challenges, employers can successfully navigate the complexities of salary sacrifice benefits and maximise the positive impact on their workforce. The team at Lewis Brownlee have extensive knowledge of these schemes and their workings. If you think you are ready to make the offering and help better your employees wellbeing (not to mention attracting more talent), reach out to us and let us help you on your way!

If you’d like to speak to one of our experts about your accounts, please call 01243 782 423, or email from our contact page and we will be in touch!

We also update our YouTube Channel regularly with new content, see here: Lewis Brownlee YouTube channel.