PAYE Updates From HMRC

This week HM Revenue & Customs (HMRC) have provided a further informal update on PAYE related matters. The update covers the launch of a new P46 (Short) for employers, Company Car and Car Fuel Benefit Calculator and Save As You Earn (SAYE) share option schemes.

The new P45 (short) for employers is a one-page document, which has been produced following feedback from employers, enabling them to collect necessary information from new employees who not have a P45. The document looks just like a normal P45 but Section 2 on employer information has been removed. It should be used prior to being filed online.

In addition, the department has updated the company car and car fuel benefit calculator to reflect the increase in the car fuel benefit multiplier brought in on April 6 this year.

The calculator allows an employer to calculate the ‘benefit in kind’ value of a company car and, if appropriate the car fuel benefit and provides an indication of the Income Tax the employer would be liable to pay for the provision of company car and car fuel benefit.

The changes include the fact that there will no longer be any reductions for alterative fuels and the diesel surcharge will apply to all diesels, whenever registered.

In addition, the £80,000 limit for the price of a car for car benefit purposes will no longer apply and the fuel benefit multiplier is increased from £18,000 to £18,800.

And finally, changes to bonus and interest rates to SAYE share option schemes have been made effective from August 1 this year, bringing them into line with other interest rates. Both 3 and 5-year contracts remain unchanged but the bonus rate for 7-year contracts has gone up from 0 per cent to 0.58 per cent.

As an accountant, Simon Denton specialises in providing PAYE advice, support and guidance.

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