PROFESSI NALIssue 67 - CIPP
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PROFESSI NAL
Official publication of The Chartered Institute of Payroll Professionals
in Payroll, Pensions & Reward Issue 67
February 2021
Remote working and
payroll software in the
cloud
Employer-provided
seasonal flu jabs
Treatments
Payroll saved from
payrollpensionsandreward.org.uk
pension misery
Solutions
Starting your own
business
Stimulants
CIPP UPDATE | POLICY HUB | PERSONAL DEVELOPMENTTRUST
Frontier Software
with your payroll
processing
Accurate, secure and reliable
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OFFICES IN AUSTRALIA, INDIA, MALAYSIA, NEW ZEALAND, PHILIPPINES, SINGAPORE AND UNITED KINGDOM“Every new beginning comes from some other beginning’s end.”
Seneca (4BC–65AD) (http://bit.ly/3pfw039)
On pages 37–42 are several articles how some previously displaced individuals have successfully
on remote working and payroll software set up a new business. Might some readers want to act
in the cloud. Will these become the similarly?
enduring ‘new normal’ ways of working? Best wishes – and bring on vaccination!
See pages 20–21 for a reminder of the
imminent introduction of the postponed off-payroll working
rules. Has the pandemic reduced the impact on employers?
A continuing effect of the pandemic is job losses. This issue Mike Nicholas MCIPP (editor@cipp.org.uk)
has the first two in a series of articles (pages 10, 11, 13) on Editor
Chair’s message
I hope this finds each of you safe and a level of over-communication, so that everyone remains engaged.
well and adjusted to the new ways of New team members, whether new to the industry or just new to
working. The main theme for this edition the team, must be fully supported to feel engaged and part of the
is remote working and payroll software in team and I would always encourage social time, so the coffee-
the cloud, so I will touch on both. break chats are not lost. As for the cloud and accessing payroll
With focus on safety and flexibility, the software anywhere, anytime, the pandemic has certainly brought
movement towards remote working and a that type of strategy and capability to the fore as all businesses
continued approach to this initiative, pose several questions. What review their digital transformation strategy and consider whether
may have been considered as a short-term drive to support the or not they can truly work remotely in an efficient manner.
health of the nation, has become a longer-term strategy. Adjusting I hope you find the articles contained in this edition of interest
to this and deciding if it can truly work for you is almost exclusively and of benefit to you, and please do drop me a line if you want to
a personal choice, as it has to take into account an individual’s discuss anything contained in more detail
home life, whether they can work safely and confidentially in that
environment, and not just whether there is a choice involved.
If the answer is ‘yes’, then managing your working day and
commitments becomes much more disciplined to ensure it
does not stray into personal time. Also managing teams remotely Jason Davenport MCIPP MIoD (jason.davenport3@cipp.org.uk)
requires a greater focus on a variety of communication styles and Chair, CIPP
CEO’s message
Let’s hope that 2021 is much better year than and appeals committee, led by our independent chair, Helen Fairfoul,
last year. who, with various board colleagues, met and interviewed all candidates
Writing this just prior to Christmas, it’s been as part of our governance process.
perturbing to see an increase in the tiers/ The successful candidates who will stand for election will be
levels in many parts of the UK. I’m sure that announced at our AGM on 31 March (currently planned online through
many of us, back in March 2020, never imagined MS Teams, but watch this space)(see page 17). You will notice this date
we’d still be in the throes of this pandemic. It is to is a change from our usual AGM date in December, which has arisen
be hoped that the release of vaccines, slowly but surely, will move us to due to the change in the CIPP’s financial year some three years ago. This
some degree of normality – but who knows what ‘normality’ will look like change put considerable pressure on timeously completing the year end
going forward. And just as we see a glimmer of light at the end of that processes, and yet adhering to the Charter in which the AGM had to be
particular tunnel, we have to contend with the small matter of what Brexit held in the same year.
looks like. The Charter changes recently agreed by the membership has allowed
Just a year ago the notion that whole payroll teams and departments us to move the AGM into the following year, easing the pressure on
decamping home en masse would have been unthinkable, for the year end accounting process and allowing more measured time for
various operational and governance reasons. But we did it – and were applications for board positions by the membership. Remember to use
acknowledged by government as key workers in ensuring the UK your vote!
continued to be paid. All that remains is to wish you all a safe but successful and prosperous
It’s an intention of the CIPP to hold more roundtables and the like on 2021!
the very topic of what the ‘future payroll professional will look like’ and
how the pandemic has influenced and shaped the future of payroll. We
will seek contributions across all of our membership levels on this topic.
February sees the election opening for two new directors to the CIPP
board. As usual we had a large number of members putting themselves Ken Pullar FCIPP (ken.pullar@cipp.org.uk)
forward for election. I’ve been grateful for the support of the nominations Chief executive officer, CIPP
Issue 67 | February 2021 | Professional in Payroll, Pensions and Reward | 1PROFESSI NAL Also available online at
payrollpensionsandreward.org.uk
in Payroll, Pensions & Reward
Contents February 2021
THIS ISSUE’S FEATURE TOPIC
REMOTE WORKING AND PAYROLL SOFTWARE IN THE CLOUD
39
Remote
working
and payroll
software in
the cloud
by Jerome Smail
Features
10 13 19
CJRS and the importance
Starting your own business Starting your own business of compliance
by Jo Marshall by Jason Davenport by CIPP’s policy and research team
20 22 28
Preparing for off-payroll Employer-provided seasonal
working flu jabs GMP equalisation
by Lora Murphy by Beverley Gibbs by Gareth Stears and Dave King
2 | Professional in Payroll, Pensions and Reward | February 2021 | Issue 6729 30
Editor
Failure to return to work, Mike Nicholas
Payroll saved from pension whistleblowing events, age 0121 712 1000 | editor@cipp.org.uk
misery discrimination
Advertising
by Henry Tapper by Nicola Mullineux
Vickie Graham
07775 564 352 | advertising@cipp.org.uk
32 35
Design
James Bartlett, Nicole Davis and Sam Parkes
Payroll saved from
design@cipp.org.uk
Printing
Warwick Printing Company Ltd
pension misery
Gender pay gap reporting
2021
by Danny Done
Passionate about payroll
automation
Chief executive officer
by Maria Mason
Ken Pullar FCIPP
Henry Tapper, chief executive officer of AgeWage, outlines radical proposals andCIPP
the board of directors
37
CIPP’s key role 38 Jason Davenport MCIPP MIoD
Stuart Hall MCIPPdip
Dianne Hoodless MSc ChFCIPP FHEA
Liz Lay MSc FCIPPdip
Carole Pearson MCIPP
Katie Sharpe ACIPPdip
Finance’s reliance on legacy Cliff Vidgeon BA (Hons) FCIPP CMA ACIS
systems Payroll in 2021 and beyond Clare Warrington MSc FCIPPdip AFHEA
by Tim Wakeford by Simon Parsons
Useful contacts
42 Education
education@cipp.org.uk
0121 712 1023
Events
events@cipp.org.uk
0121 712 1013
I’m a payroller, get me out of here!
by Jennifer Morrell General enquiries
enquiries@cipp.org.uk
0121 712 1000
Regulars Marketing and sales
marketing@cipp.org.uk
0121 712 1033
01 Editor’s comment, and
Chair’s and CEO’s message 19 Compliance
Membership
membership@cipp.org.uk
24
0121 712 1073
05 CIPP update, We’ve got mail Payroll news
Events, news and developments Training
training@cipp.org.uk
06 My CIPP
Policy hub: On your behalf,
27 Reward news 0121 712 1063
cipp.org.uk
Advisory
28 Reward @CIPP_UK
10
Articles
Personal development
35 Technology Please support this magazine so that it can continue to be a part
Starting your own business, A of your membership package.
week in the life of, BePayroll,
Trademarks
Diary of a student
44
The CIPP logo, the initials ‘CIPP’ and the words ‘Professional in
Industry news Payroll, Pensions and Reward’ and ‘CIPP Consult’ are trademarks
16
of the Chartered Institute of Payroll Professionals. Copyright: The
Movers and shakers Chartered Institute of Payroll Professionals 2021. The Chartered
47
Institute of Payroll Professionals, Goldfinger House, 245 Cranmore
Wordsearch Boulevard, Shirley, Solihull, West Midlands, B90 4ZL.
Switchboard 0121 712 1000
17 Charity news
52
Copyright
Confessions of a payroll This magazine is published by The Chartered Institute of Payroll
manager
18
Professionals in whom the copyright is vested. All rights reserved. No
COVID-19 news part of this publication may be reproduced, stored in a retrieval system,
or transmitted in any form or any means, electronic, mechanical,
photocopying, recording or otherwise, without the prior written
permission of the publisher. The views expressed in this publication
are not necessarily those of the CIPP or the editor. The information and
comment contained in this publication are given in good faith, their
Full issue including additional online content available at payrollpensionsandreward.org.uk accuracy or completeness cannot be guaranteed.
Issue 67 | February 2021 | Professional in Payroll, Pensions and Reward | 3NEW TO PAYROLL AND
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cipp.org.uk @CIPP_UKCIPP
update
WELCOME TO the February edition. We hope January went well for Congratulations to the newly red
Institute
rte ofessionals
ha ll Pr
you all, and that you are settling into the new routine for 2021. accredited PAS organisations o
SCHE ME
of P e C
r
ay
Th
If you or your business are thinking of changing software provider,
PAY R
then our 2021 Software Directory will be included in the March THE CIPP’s Payroll Assurance Scheme (PAS)
CE
LL
ASSURAN
O
issue. This supplement enables you to review and compare products is designed to test your payroll processes in
at a glance, a great tool to help with your forward planning. relation to payroll processing, compliance and
Looking back to the end of 2020, the last activities the CIPP held the people skills and development opportunities.
before the Christmas break were two Chartered members’ events One of the most important elements is ensuring business
during December. One was held on 2 December and the other continuity plans are in place and effective should they be
on 9 December. These events were scheduled as a replacement required. Given recent events, congratulations to all organisations
to the usual Chartered dinners held throughout the year. They that have achieved this accreditation and will have been able to
were extremely well-attended and lively events and were a great put those plans into action.
opportunity to network with others in the industry; something we did Special congratulations to our recently accredited
not have much opportunity to do in 2020. organisations:
We kick off 2021 with our new and re-branded members only ● Trident Trust Marine Services
‘BeKnowledgeable’ webinar events. The first was held on 19 January ● University Hospitals Birmingham NHS Foundation Trust
and focussed on off-payroll working (also sometimes simply referred Ken Pullar, CIPP chief executive officer, said: “Never has it been
to as ‘IR35’), as we help to prepare the industry for the introduction more important for businesses to have good payroll processes,
of the reforms into the private sector. The second will be held on 10 knowledge and skills that enable them to implement new
February and will focus on the national minimum wage. The new government legislation and guidance quickly. Congratulations to
BeKnowledgeable webinar sessions, which will be hosted by our those organisations that have recently demonstrated just that.”
policy team officers, Gemma Mullis and Lora Murphy, are designed The Payroll Assurance Scheme is still operating, with
to help CIPP members be at the top of their game. Keep your eyes assessments currently operating virtually. To find out how the
on our website, emails and our News Online service for details of Payroll Assurance Scheme can benefit your organisation, email
more BeKnowledgeable webinars coming up throughout the year. compliance@cipp.org.uk.
We’’vveeggoot tmmaailil
We
Aggregation of earnings
Memories
Pages 20 and 21 ofofNorman Green
issue 66 (December 2020 – January 2021) of Professional magazine featured an article
I was sorry to hear of
on this payroll processing problem,the death of my friend and
prompting theformer colleague
following welcome Norman Green. I used to represent HM
communication.
Revenue & Customs, formerly Inland Revenue, at payroll conferences from the late 1980s through to 1995, when
The useearly
I took of the weekly earnings
retirement. period through
I met Norman looks like an conferences
your unexpected and consequence
through his ofwork
the abolition of contracting-
with the British Computer
out. This
Society. is because contracted-out employment took precedence over not-contracted-out employment for
classIn1my National Insurance contributions (NICs) and hence the monthly earnings period
role as group leader of the Employer Group on PAYE Operational Policy I valued highly the chance to was used.
Monthly
work with employment tended in the
Norman. His constructive main to
criticism be full-time,
worked and the with
even-handedly nursing bankifwork
support was
he felt thatthus
thenon-
departmental
pensionable, being classed as ‘overtime’ for NHS
representative was in danger of getting an unreasonably rough time! Pension Scheme purposes, so being not contracted-out
employment.
Norman and Occasionally
I shared aI friendship
did come and across examples
personal of weekly
interest and monthly
in interesting cars, andcontracted-out employments
it is on that account that I
which gave rise to the problem described in the article.
particularly recall the BPMA’s autumn conference of 1994, held at my beloved National Motorcycle Museum. I
A solution
had addressed to this, which HM Revenue
the conference during the& afternoon
Customs were quite
and sat down happy
with with
him at
overthea time,
cup ofwastea.toHe pay the of
knew bank
my
work on a monthly basis but provide an advance of the bank nurse work. The bank
plan to buy a Morgan Plus 8, knew that I had not actually ever driven a V8 car, and insisted that he and I take work pay was reduced
bya an
littleamount
trip in hisrepresenting the taxbefore
Reliant Scimitar, and NICseachdue. A specified
setting number
off for home. of the
I didn’t needbank
to beweeks
askedwould
twice!then be my
I bought
automatically transferred within the payroll to be processed with the monthly pay and
Morgan 22 years ago, still own her, and often think of that afternoon when setting off round Worcestershire lanes. the amount advanced
recovered.
I am sad Not to sure whether
realise that lastthe advance
year’s pay method
exchange wouldcards
of Christmas be allowed
was to be nowtheunder
end of real time information,
a chapter. I shall think of
since it is a ‘regular’ payment – well, as regular
you, Norman, when our postman begins this year’s deliveries. as ‘as and when work’ can be.
Surprised somewhat
My kind regards both
go to anythat
whoit may
hasn’t cropped
vaguely up before
remember meand fromthat it wasn’t
those halcyonanticipated
days. when the abolition
of contracting-out was first mooted. Unusual for the payroll industry not to have picked up on this. Whether it’s
because
David Toye aggregation is a mainly public sector problem, and perhaps limited mainly to the NHS, although I’ve
no evidence of this.
Vince Ashall MSc FCIPP
Issue 67 | February 2021 | Professional in Payroll, Pensions and Reward | 5MY CIPP
On your
behalf
Policy team update
The CIPP’s policy and research team provide an update on developments
T
he CIPP’s policy team are always that has employees working in the EU or opportunity that was completely
striving both to raise the profile European Economic Area (EEA). The same unexpected, it is highly likely that either
of the payroll profession and to applies if their employer seconds or posts this relates to a high-risk investment or it
educate members and non-members in UK employees to work temporarily in an is a scam. The scams can come through
relation to both current payroll policies EU or EEA country. a variety of communication methods with
and those on the horizon as and when cold-calls often used; however, a scam
proposed by the government. In order to Avoiding pension scams could arrive in the form of an email, by
facilitate this, the team attend a number The Pensions Regulator (‘the Regulator’) post, or be advertised online.
of meetings, and respond to consultations runs a number of campaigns to alert ● Be wary of warning signs –
published by various government bodies. individuals saving for their future to the Unexpected contact, time pressure, social
The tail-end of 2020 saw much activity types of pension scams currently in proof, unrealistic returns, false authority,
in that space, and the team were involved operation. Unfortunately, the number of and flattery, are all cited as warning signs of
with several meetings to discuss both scam schemes has increased significantly pension scams.
current and potential future policies that throughout the pandemic, as unscrupulous ● Check if a firm is FCA-authorised –
are impacting, and will impact, the work of criminals attempt to prey on the most The majority of financial services firms
payroll professionals. vulnerable in such uncertain and turbulent must be authorised by the FCA, and if
times. they aren’t any pension offers are likely
Expat Forum What the Regulator is reporting is that it to be scams. Individuals can access the
The Expat Forum brings together is seeing an increase in savers wishing to Financial Services Register (http://ow.ly/
professionals who deal with the payment transfer their pension due to the instability RBUr30rp8pW) to establish whether a
and treatment of expatriates, living and of their employer or the broader financial firm or individual is either authorised or
working outside of the UK, and also of markets. The resounding message to savers registered.
those who come from abroad to work is to be cautious and vigilant, particularly ● Ensure the contact is not from a ‘clone
within the UK. of scammers who attempt to lure them firm’ – This is a frequently used scamming
At the forefront of everyone’s mind to what is known as ‘safe havens’. Where method, in which the scammer company
is what is going to happen in terms of savers are enquiring about transferring poses as a genuine firm. Use the contact
reciprocal social security agreements their pension, the advice is to direct details provided on the FCA’s Register,
between the UK and countries in the them to the Financial Conduct Authority’s and not the details provided by the firm. A
European Union (EU). At the time of (FCA’s) ScamSmart page (http:// firm’s details should also be checked with
writing, no formal agreements have been ow.ly/8hin30rp8ox) which offers detailed directory enquires or Companies House
confirmed with EU countries, with the guidance and gives particular emphasis to (http://ow.ly/M7qa30rp8q6) to ensure
exception of Ireland; Switzerland and the pension scams that are in place as a result that they match.
UK have also confirmed that they have of the impact of Covid-19. ● Check the FCA warning list – Savers
made an agreement. Key pieces of advice for savers are as should utilise the FCA Warning List (http://
Payroll professionals must await further follows: ow.ly/b6iP30rp8qq) to check the risks of a
guidance on how to proceed if they ● Reject unexpected offers – Where potential investment. There is a reminder,
process the payroll for a UK employer there is an offer of an investment however, that even if a firm is not included
on the list, it could potentially still be
...no formal agreements have been operating a scam.
● Get impartial advice – Savers are
confirmed with EU countries, with the advised to consider seeking financial advice
exception of Ireland... or guidance, prior to investing. The Money
6 | Professional in Payroll, Pensions and Reward | February 2021 | Issue 67Policy hub
One hour skills
Advice Service provides information on not just relate to employees in Scotland,
boosting courses
investing and how to source a financial but across the whole of the UK.
adviser (http://ow.ly/1RCn30rp8qF). If the request to ‘swap’ is not actioned, New one hour e-learning
● Report any suspicions – Individuals via PAYE real time information, employers
suspicious of a firm, and believe they are will be sent a notification from the generic courses for only £75 +VAT
operating a pension scam, should contact notification service (GNS). The policy team
the FCA’s Consumer Helpline or use its advice is not to ignore any GNS message,
reporting form (http://ow.ly/3Ezz30rp8tX). and to action any notification sent, One CPD point per course
● Be wary of future scams – Those who especially around student loans, to ensure
have already fallen victim to scams are that the deductions are correct to each
more likely to be targeted again, either by employee’s circumstance.
the same fraudsters or by other criminals
who have purchased the person’s details. Further extension to the CJRS
Ordinarily, when there is a major update
...employers can
claim for 80% of
to the workings of the coronavirus job
retention scheme (CJRS), or indeed, any Calculating income tax
of the measures relating to support for
employee wages businesses and individuals through the
outbreak of coronavirus, an announcement
for the remainder is made in the Houses of Parliament.
of the duration of On Thursday 17 December 2020,
however, the chancellor of the Exchequer
the CJRS... tweeted about an additional month-long
Construction Industry Forum
extension to the CJRS, thereby signifying
the importance of social media and
Calculating Statutory
The policy team recently attended the
inaugural meeting of the Construction
highlighting the many ways in which
payroll professionals should keep up to
Sick Pay (SSP)
Industry Forum, a stakeholder group date with important developments. What
recently established which includes this means is that, as opposed to closing
members from the tax, accounting and on 31 March 2021, the CJRS will now
construction industries. The CIPP will attend close on 30 April 2021.
this forum to provide the payroll industry’s Initially, it was advised that the level of
perspective, with particular focus on how government support through the scheme
the construction industry scheme offsets
interact with real time information and pay
would be 80% for November 2020–
January 2021, and that there would be
Calculating National
as you earn (PAYE) functions. an assessment of the ongoing impact of
the pandemic closer to the time in order
Insurance Contributions
Student loan consultation group to establish the amount provided by the
During the recent consultation group government for February and March 2021.
updates were given on the implementation It is now confirmed that employers can
of the Plan 4 student loan which will be in claim for 80% of employee wages for the
place from 6 April 2021. remainder of the duration of the CJRS,
Paying Statutory
This plan will relate to those who took until the end of April 2021.
out a Scottish student loan while they The Budget date was also announced
were studying. Those who are on either and will be delivered on 3 March 2021.
Plan 1 or Plan 2 to whom this relates will, By extending the length of the scheme Maternity Pay (SMP)
from 6 April 2021, be moved onto the by an additional month, this gives more
new Plan 4. It has been confirmed that than 45 days for employers to make
notification to move these employees will business decisions following on from the
be sent at the same time as the usual SL1 announcements made in the Budget. In
student loan start notices in early March situations where businesses are required For more information or to enrol:
2021. to make more than 100 redundancies, the
Employers will not get start and stop consultation period must commence at Visit: www.cipp.org.uk
notices for affected employees but will least 45 days before any dismissals take Email enquiries@cipp.org.uk
be advised to ‘swap’ the current plan of effect, so the rationale behind timescales Call: 0121 712 1044
an employee to Plan 4. Employers need is apparent. Live chat with us
to ensure that this change is actioned, as At the time of writing, additional
not doing so will mean the employee is guidance on the extension to the scheme
overpaying their student loan. This does had not been published. n
cipp.org.uk
Issue 67 | February 2021 | Professional in Payroll, Pensions and Reward | 7 @CIPP_UKMY CIPP
Advisory
The CIPP's Advisory Service team provides
answers to popular questions
Q: Do expenses form part of attachable A: As the company owns the laptop, which Q: An employee has received a
pay for the purpose of calculating the employee is purchasing, there would temporary National Insurance number
deductions under an attachment of be a transfer of an asset and therefore a (NINo) due to the Coronavirus
earnings order? taxable benefit arising under section 206 pandemic. Should we operate this in
A: Payments the employer makes to of the Income Tax (Earnings and Pensions) the payroll system?
reimburse expenses the employee incurs in Act 2003. The taxable benefit would be A: You would not use the temporary NINo in
the employment are not within the definition reported in the P11D return at section A. the payroll system as they are not accepted
of attachable pay for attachment of earnings The cost of the benefit would be the by the Quality Standard. If, when submitting
orders. If you are unsure whether a particular market value of the asset at the time of a full payment submission (FPS) for the
item is within scope you could contact the transfer less any amount made good by the employee, the employer does not know
originator of the order to seek confirmation. employee. their NINo, the NINo field should be left
Even if the amount made good reduces blank but the employee’s date of birth and
Q: An employee who is being made the taxable benefit to zero, this will still need gender entered in the appropriate items.
redundant this month had purchased to be reported in the P11D. See page NIM39110 of HMRC’s National
a bicycle under the cycle-to-work Insurance Manual (https://bit.ly/3qCvRbJ)
scheme. The salary reduction was first Q: A third party customer wishes to pay for guidance.
due to occur this month. Are we able a cash bonus to a client’s employees
to deduct anything more under salary for their hard work during the Q: How many keeping in touch days
sacrifice? coronavirus pandemic. Is this taxable? are parents entitled to during statutory
A: Unfortunately, you are not able to make A: Yes, this will attract both PAYE (pay as you shared parental leave (SShPL)?
any deductions through salary sacrifice. You earn) income tax and class 1 NICs; however, A: For the purpose of whether a parent is
should refer to the terms of the agreement the collection of this isn’t as straightforward considered to be ‘working’ which would
reached between the employee and the as normal. affect payment of statutory shared parental
employer to establish what happens if, When an award is given to an employee pay and continuation of entitlement to
amongst other things, the employee ceased from a third party, it is classed as a third-party SShPL, a parent can undertake work on
employment during the loan period. Such award. As this award is being given in cash, twenty SPLIT (shared parental leave in
a relevant provision might, for example, the following must be applied. touch) days.
require return of the cycle and/or permit a The third party must process the value
deduction from the employee’s net pay. of the award for PAYE tax purposes, which Q: Why is there a fluctuation of 20p
If the cycle is less than five years old and mean obtaining details from each employee in an employee’s tax deduction this
ownership is transferred to the employee, being given the award. The third party would month?
a taxable benefit arises based upon the then process the payment via their payroll A: The fluctuation is due to the rounding in
cycle’s age at the date of transfer, its original for tax purposes only, with many grossing the taxable pay amount (e.g. after deducting
cost and the acceptable disposal value this up so that the employee receives the the tax free pay), as the calculation of the tax
percentage. The employer would pay class full cash amount. is based on whole pounds. When working
1A National Insurance contributions (NICs) The employer must then be notified out income tax cumulatively under pay as
on this amount. of the cash amount gifted and the tax you earn, eventually the previously ignored
For reference purposes, see pages associated and paid on the cash given. The pence make a whole pound and then 20%
EIM21664–EIM21668 in HM Revenue & employer then adds this to their employee’s of this is 20p, which is where the difference
Customs’ (HMRC’s) Employment Income PAYE record as a class 1 NICs liability only, comes from.
Manual (https://bit.ly/3gmAsd2). thus both the employee and employer
paying class 1 NICs on the value. Q: When submitting a P46(Car) return
Q: An employee would like to buy their Guidance on third party awards is for an employee who is giving up a
employer-provided laptop from the available here: https://bit.ly/2K1OC84 and cash allowance and taking a company
business. Is there a reportable benefit? here: https://bit.ly/3mvjIlx. car, do I show the annual value of the
8 | Professional in Payroll, Pensions and Reward | February 2021 | Issue 67ONLINE LEARNING
Policy hub
FOUNDATION
allowance given up or the list price of
the car (depending on which is more)?
A: Where the employee repays the
overpayment, and the tax year in which the
DEGREE ACCESS
A: The P46(Car) return asks for all the
relevant information and also if the
overpayment occurred is still open, then
you can adjust the pay, tax and NICs figures COURSE
employee is giving up/foregoing ‘cash’ to be appropriately for that year and report to
in receipt of the car and the value. HMRC via the full payment submission.
This course is a bridge to year
The value entered would be the annual Where an employee has repaid the
amount the employee would have received overpayment, and the tax year in which two of the CIPP Foundation
if they had not chosen the car, but this may the overpayment occurred is closed, you Degrees in either payroll and
be prorated if the employee is in receipt should claim the appropriate tax and pensions, and specifically designed
for only part of the year as illustrated by the NICs refunds from HMRC. This is because
for those who have the experience,
following example: adjustments to the monthly or quarterly
Sue has decided that she would like to remittances of tax and NICs should not be and would now like a formal
give up £5,000 of her salary for a company made in a later tax year without obtaining qualification
car that she will receive in June. the agreement of HMRC.
The value of cash foregone would A replacement record must be sent
We have developed this online
be calculated as: £5,000 ÷ 12 × 10 = to HMRC for the previous end of year
£4,166.67 (June to March = 10 months for submissions. course to provide those who have
the calculation). completed one of our level three
Q: This tax year we have acquired certifications, or who have two
Q: We employ seasonal workers who three companies that were below the
years’ experience and are confident
remain ‘dormant’ for many months and limit for the apprenticeship levy. If our
usually do not return to work. When company is liable to make payments, with manual calculations.
should we remove them from the would these companies start to pay
payroll? the apprenticeship levy from the date If this sounds like you or a member
A: There is no guidance on when you we bought them?
of your team, enrol today.
should remove dormant employees. HMRC, A: Government guidance (see http://bit.
however, will assume an employee has left ly/3gPnyEH) confirms that your pay bill is
the employment if they are not paid after a cumulative and apprenticeship levy must
three-month period. be considered from the first time you
It is recommended to have data cleansing process a payroll for a connected company.
procedures in place to remove employees
from the payroll who are inactive for three Q: Can we accept photocopies of
months. a MATB1 certificate for statutory
maternity pay purposes?
Q: If we were to change our private A: Government guidance (see https://bit.
medical insurance deductions to ly/39Vo96F) says that a photocopy of the
salary sacrifice, would the optional certificate is acceptable.
pay arrangements (OpRA) tax rules
apply? Q: For the purpose of calculating the
A: Yes, private medical insurance would be maximum 28 weeks of statutory sick
subject to the OpRA rules. pay (SSP), are waiting days included?
Where an employee chooses to receive A: No, the waiting days are not included
a benefit as opposed to an amount of in the 28 weeks, as SSP is not payable for
cash pay, the taxable value of the benefit them.
is taxed at whichever is the higher of the
CPD
amount of cash pay foregone or the taxable Q: How is the rate of tax to pay
value of the benefit under the normal in a PAYE settlement agreement
18 points
benefit-in-kind rules. If the two are equal, determined?
then normal benefit calculation rules must A: The calculations for determining the rate
be applied. are based on each employee’s marginal rate
For more information or to enrol:
The CIPP policy and research team’s of tax at the end of the tax year. Visit: www.cipp.org.uk/study
OpRA fact sheet can be found here: To establish the employee’s marginal Email enquiries@cipp.org.uk
https://bit.ly/2Ilg0gb. rate you need their gross taxable pay plus
Call: 0121 712 1023
the taxable value of any benefits provided
Q: An employee has been overpaid minus their income tax personal allowance
Live chat with us
and has agreed to pay back the according to their final tax code.
overpayment. What is the process to Guidance can be found on the gov.uk
correct our payroll records? website at http://bit.ly/2VqsSHu. n
cipp.org.uk
Issue 67 | February 2021 | Professional in Payroll, Pensions and Reward | 9 @CIPP_UKPERSONAL DEVELOPMENT
Starting your
own business
Jo Marshall MCIPPdip, freelance payroll trainer and consultant, Yorkshire
Payroll Services Ltd, outlines the formative events when surrendering the
comfort of employment and the crucial issues faced in working for herself
I
often ask delegates how they got into user groups. One of the changes I made was I had to be self-employed. Making
payroll. Probably 95% of the time, the was to have a payroll user group session, the decision was the scary bit: go for
answer is always the same: they fell once a year, just before the start of the tax your dream job and give up the security
into it. This answer probably best explains year. This was an opportunity to discuss of receiving a monthly salary, knowing it
how I ended up setting up my own the changes in the software and to also covers your mortgage and bills, and having
business. invite CIPP to discuss the new tax year to give all of that up.
Let me take you back to the start changes – which is how I got to know the How did I decide? It dawned on me
of 2016. I was working for a software team at CIPP. So, when I decided a move that for the first time, in a long time, I
company that provided a human resources was required, it was to the CIPP that I felt excited about this opportunity, the
and payroll solution. I’d worked there for turned. enthusiasm and passion for payroll,
ten years and was one of the few team At the time, CIPP were recruiting for something that I had not felt for so long. I
members who had been there at the start, payroll trainers to deliver their public jumped. I went for it, full steam ahead.
helping to build the business, believing in training courses. I submitted my CV and Following several conversations, with
the product, wanting to help clients and was invited to a meeting at the head office various people, I made the decision to
colleagues. They were great times; we in Birmingham, where I met the training set up a limited company, rather than
were a family; we genuinely cared. During manager. Everything sounds perfect so being self-employed. By doing this, I felt it
those ten years, I worked as a consultant, far, but unfortunately the role was not opened the door for more opportunities
project manager, payroll quality manager, a contract of employment – the public to work with other businesses, for
all the way to head of payroll bureau trainer was a self-employed role. example, offering consultancy with payroll
services. But as with all good things, they And so, this is where my story begins. implementations. This was fairly easy
come to an end. The business was sold, With my twenty years of payroll experience to do: I registered online at Companies
and within just a couple of years things this was my dream job, my opportunity House and paid the registration fee.
had started to change, so a move was to give something back to the payroll Remember though, by setting up a limited
required. industry, to pass on my knowledge, and to company you agree to all the duties
One of the tasks for which I was help train the current and next generation required as director of that company,
responsible was organising the company’s of payroll professionals. The only snag including the confirmation statement every
year.
...for the first time, in a long time, I Next was the PAYE (pay as you earn)
reference; again, all online and probably
felt excited about this opportunity... something that most payroll professionals
10 | Professional in Payroll, Pensions and Reward | February 2021 | Issue 67Starting your own business
...still doing my dream job training BrightPay, a nice little payroll system and
payroll professionals, and I’m reasonably priced.
This is where the indemnity insurance
delighted to say my clients are still raises its head; paying a few hundred
with me... pounds a year for training and consultancy
but now offering payroll processing
increased my indemnity to nearly a
have had to deal with. For the first year curve already running my own business, thousand pounds a year. Again, get quotes
of trading I processed my payroll using could I help others like me? I started before offering additional services to
HMRC’s Basic PAYE Tool. Not the best putting the word out, would anyone want clients!
product I had ever used, but it did the job this service? Along with all of this, I also had
of submitting PAYE data to HMRC. Most accountancy practices offer to register with the Information
I had several meetings with different bookkeeping and payroll services, but they Commissioner’s Office for data protection.
accountants, which was an interesting often come with a high price tag, which for Again, all online and a yearly fee to pay,
exercise, as I gained so much information a small business can be tough to swallow. which can be set up via direct debit. My
from these free initial meetings. Eventually Although I could undercut on cost, I felt certificate hangs proudly in my office.
I settled on one accountant, who I still it was also important to offer a personal Earlier I mentioned my accountant,
work with today; but more about that later. service, getting to know each client and and it is here where I bring him back into
Next was indemnity insurance. understanding their business, helping the picture. Barry was a godsend. He
Depending on what services your them manage their accounts and guiding encouraged me when I doubted myself,
company offers, will dictate the price them through what can be complex areas. and he agreed to complete my clients’
you pay for this cover. Offering training/ This becomes the unique selling point: financial year end accounts at a fraction of
consultancy can be fairly reasonable, but you genuinely care and want to help your the price of other accountants. He sends
it’s worth asking for quotes before offering clients. me new clients, I send him new clients;
any other type of services. Through word of mouth, I quickly we work well together, and during the
Last but far from least was to become gained a client: an IT company, a single furlough claims we supported each other.
VAT registered, again all online. I registered director limited company. He’d got himself And so, here I am, four and half
for the flat rate scheme, which back in into a bit of a mess with his accounts, years later and still going strong. I’m
2016 was really good. and so I spent several weeks bringing his still doing my dream job training payroll
Following all of this, there I was, no job accounts up to date, all on spreadsheet. I professionals, and I’m delighted to say
security, agreeing to every training day very quickly realised that I would need a my clients are still with me, even the IT
that CIPP offered. Luckily, I was introduced good bookkeeping solution that ideally had company, whose accounts are in perfect
to Colin Jackson who headed up the a payroll offering too. order – and I was able to claim the job
consultancy side of CIPP at the time, which I settled upon QuickBooks which is retention scheme for him, too.
included the Payroll Assurance Scheme a browser-based solution, everything is Don’t get me wrong, it is tough going
(PAS). This brought in extra and much in the cloud. They offer a ‘pro advisor’ it alone. There have been a number of
needed work, but I quickly realised that I program, and better still a licence for ten times, even now, when I work out the
needed to bring in more work. databases at a fraction of the usual costs. income for the month and then divide that
I looked back over my CV and I then needed to register with HMRC to by how many hours I have worked and
highlighted all the skills I had gained become an agent. I selected PAYE and VAT, realise I’ve earned less than the minimum
throughout my working career. Although allowing me to deal with these areas on wage. These are the low times – but try
payroll was obviously the most dominant, behalf of my clients. After using the payroll and stay strong.
I had started my working life in accounts, solution for about a year, and growing Would I change anything? No. If I hadn’t
so could I offer bookkeeping and payroll the business to take on more clients, I experienced the highs and the lows, I
services? I’d experienced a huge learning switched payroll solutions, and moved to wouldn’t be where I am today.
What will the future bring? Well, IR35/
off payroll working, which has been live in
the public sector since 2017, is planned
to go live in the private sector in April this
year following a one-year postponement
due to the pandemic. This could impact
future consultancy work, but I am
determined to keep going! n
Starting your own business
This article is the first in a short series
featuring the views and experiences of
a few of those in the industry who have
pursued a career as their own boss.
Issue 67 | February 2021 | Professional in Payroll, Pensions and Reward | 11A week in the life of
Alanoosh Williams MCIPP,
Head of payroll, Agilisys
M
y team and I all have certain jobs Tuesday on any complex issues we may have.
to complete during the payroll I finished the day raising two reports for
cycle. Every Monday, we draw I had eight separate calls on various the HR director.
up a schedule for the week ahead with the subjects, ranging from wellbeing calls,
team bringing to the table anything they NHS pensions, calls with PWC on taxation Thursday
may have scheduled. advice, and meetings working on calculating
We review task lists and any requests furlough for our different client payrolls. I attended an online legal webinar which
that have come in as well as business- As being a home-worker does mean discussed current legislation and provided a
as-usual to map out the week. We use more meetings/calls, I now try to allow recap of where we are with the coronavirus
the schedules for audit purposes which fifteen minutes after each call so I can send schemes as well as employment law.
also covers us in case of absence. I highly follow up emails or complete any actions. Just two calls today and three reports to
recommend doing this for your teams. Tuesdays I ensure any admin is cleared, issue with a weekly meeting mid-afternoon
Here is a sample week from 19 and work through to-do lists to clear any with the system teams. We discuss any
October. outstanding actions. outstanding change requests, impact analysis
documents for future installs, any issues
Monday Wednesday which may have come up during the week,
and future roadmap items.
I try and schedule all regular calls and, I had five separate calls on various subjects, The rest of the day is spent on reviewing
meetings with the heads of the teams to commencing with our weekly leadership benefits and reconciling staff data against all
work on the payroll schedules. call, consisting of a full round up from the the various schemes for upcoming renewals.
I always start the day by clearing all different leads in the business, chaired by
emails from my inbox. We all work on a the chief executive officer, briefing us on Friday
clear inbox policy for our own personal the business, followed by calls on various
emails, and we have a service level business topics. I try to keep Fridays clear so I can carry out
agreement of two working days for the I helped the team clear some payroll weekly audits on payroll input. We do tend
payroll box. emails as we were inundated with queries. to audit 90% of our input to ensure our
I may receive emails asking for on- We currently have 39 automated email KPIs are as close to 100% as possible. Most
costs from finance, or benefit renewals signatures for generic queries which helps of the audit is done in real time as we also
queries, complex queries etc or receive with the traffic, which for example range issue leaver letters, hour-changes letters, etc,
requests for reports, as examples, so from tax code queries, where to update so these are audited at the same time as
these are also factored in the payroll personal details, opting out of pensions. employees can view the data in real time.
schedule meeting. These are reviewed monthly as part of our We are looking to transfer our pension
We have three main process documents key performance indicators (KPIs). services to a different provider, so we had
for our BACS process, end-to-end payroll As we are all so busy, it is easy to be some new systems demonstrated today.
process and our contractors’ department. separated from what is going on within the I raise a report on annual leave for the
These are scheduled for review throughout business, so I always set time aside to look business, and then review all the reports I
the year, and today I reviewed the entire at the company channels on teams and had recently issued. For any required more
contractor document to ensure processes I spend time keeping up to date with my regularly, rather than a one-off, I submit
and legislation are still correct and the colleagues around the business by viewing a change request document to the iTrent
documents are used by the team in real all their posts. System team to see if these could be
time. I also had a fortnightly session with my automated. n
I moved onto submitting BACS for senior payroll executive. We have a set
client payrolls and finished the day raising agenda which allows us to review and work To feature in AWITLO please contact
invoices for our client payroll costs. on project work and tie up any loose ends editor@cipp.org.uk
12 | Professional in Payroll, Pensions and Reward | February 2021 | Issue 67Personal Development
Starting your
own business
Professional magazine asked Jason Davenport MCIPP MIoD, CIPP chair and
founder of Calendar Consulting, to reveal his progress as a consultant and to
provide helpful advice for those considering a similar venture
● What motivated you to set up as self- extremely fortunate and thankful for being move? – You cannot know everything, and
employed and/or to incorporate? – I a member of the CIPP board, meeting best to just get started.
had managed my career by taking on lots Chartered members and providers in the ● Has any part of your move turned out
of opportunities to learn and grow. Both industry as they are sources of excellent different to what you expected? – The
nationally and internationally, I have run forward-thinking intelligence. level of satisfaction from doing a great job
operational teams and managed many and being thanked for it, is a wonderful
tactical and strategic client relationships. ...word of mouth feeling. I have built up a mutual respect
Equipped with a broad range of skills and
experiences, I felt the time was right to
references with each of my clients and look to them
as colleagues. Engage and understand
move to consultancy and create my own is crucial your clients on a personal level, and it will
business.
● What services do you offer? – With
for business be so much more rewarding. I am also a
business mentor now to several managing
experience in public and private sector success. directors within small- to medium-size
payroll services, as well as in-house and enterprises and that has been incredibly
outsourcing at a national and international Continuing professional development is rewarding personally, too.
level, I am able to offer all that for clients key to ensuring you do not become staid ● Is there anything you wish you had
that may either be experiencing difficulties and outdated. I am also enormously proud done differently? – Take time to pick
in their arrangements or needing advice in of Professional magazine, which is an the right accountant. If you are starting
how to approach a situation. incredibly rich source of information and a a professional services business, get
● Did you identify a gap and/or a great member benefit. an accountant who specialises in that
demand in services that you wanted ● Are there any specific things which field and therefore can understand your
to fill/exploit? – My first opportunity was proved crucial to your success? – Always challenges and help you with issues you
passed to me by the then CIPP chair, Eira be authentic and true to yourself. You must will face.
Hammond, who had received a request manage the client and not over-commit. ● What are the most important issues
that she was unable to complete herself. If you cannot do something state that. and the lessons you have learned? –
That original ten-day piece of work gave Act quickly and getting things done is also Whatever happens, good or bad, it is down
me the confidence to set up. particularly important. to you alone. Networking is especially
● What skills, qualifications, and Put your client first and think more important as is following up quickly.
competencies do you consider essential broadly than just the issue they are facing. Maintain an open mind always. I have
for anyone contemplating a move to Adding value at every interaction and continued to learn new things over the last
self-employed or setting up their own taking and providing feedback, means three years, that I had no view on before.
business? If a person does not have you can help client teams develop at the ● What advice would you give to
these skills how can they obtain them? same time as delivering a solution. This is anyone contemplating becoming self-
– Motivation is incredibly important; being also incredibly rewarding personally. I use employed/consultant? – Ask yourself
a father of three means I am driven to the principle of ‘teach a man to fish and what you want to do, challenge yourself
provide for my family and to ensure I you feed him for life, rather than give a both to understand what your costs are, so
do the best I can for them every day. As man a fish and feed him for a day’. Always you can price your rates accordingly, and
a founder of a business, you must do look to build legacy, so that when you are to know if you will have the determination
everything: find the opportunities, sell your finishing an engagement the client has to succeed. Spend on business and
services, write proposals, and complete been enriched. Having word of mouth financial education and training, as it is an
prospecting daily, as well as handle IT, references is crucial for business success. investment in you. And, finally, go for it.
finances, and legal positions. ● Is there anything you wish you had I have found the entire experience to be
It is vital to maintain relevance. I am known more about before making the extremely rewarding. n
Issue 67 | February 2021 | Professional in Payroll, Pensions and Reward | 13BePayroll
#
Mark Atkinson, assistant accountant, Arlington Fleet Services Ltd, talks
about his experience of completing the Payroll Technician Certificate and his
plans for the future
Why did you choose to study the Payroll Technician How did you manage your time efficiently whilst
Certificate? studying the qualification to make sure you hit your
I chose to study the Payroll Technician Certificate as I had been deadlines?
in the role of accounts (with a little bit of payroll) for six months Managing time was a real juggling act as I work a 40-hour week,
and was starting to concentrate a lot more on the payroll side. from 8–5, I have twins to look after along with my wife, and I also
My knowledge was quite minimal, so I wanted to expand my volunteer for the ambulance service five nights a week. I found
knowledge. I thought CIPP was the best route to do this. myself studying a lot at lunchtimes and setting aside a couple of
nights a week to focus fully. I also managed to find a few moments
How have you benefitted from studying the Payroll where I could pick things up when I had the chance.
Technician Certificate?
I feel more confident doing payroll and can answer questions What would your advice be to those thinking of
from employees more clearly. I have had a pay rise as I am now studying the Payroll Technician Certificate?
undertaking the whole payroll process. It also makes me look at My advice to anybody thinking about studying for the Payroll
things in a whole new light. Technician Certificate is to do it. It is a lot of hard work, but
the rewards vastly outweigh this. I had a tremendous sense of
How has the knowledge you gained from studying the achievement once I had passed and just started looking forwards
Payroll Technician Certificate helped you in your day- rather than backwards at the benefits and what I had achieved rather
to-day work? than dwelling on the time spent studying. With the help of work and
The knowledge I have gained has helped immensely when it comes family, we made it work, and that is the biggest thing, get as much
to running payroll, from setting people up, to running the monthly support as you can, give it as much as you can and tackle it with
payroll, to processing leavers. positivity, and the results will make it all worth it.
What are your hopes for your future career?
I am still doing payroll, and this is my immediate focus. However,
I would like to diversify, and instead of going down the traditional
route of finance, I aim to branch into the HR (human resources)
function with the added benefits of managing payroll as well.
Do you have any plans to study any further
qualifications?
I have started studying again but this time for the CIPD Diploma
in Human Resource Management. However, once I have achieved
this, I may well look at studying further for the CIPP Foundation
Degree in Payroll Management, and use both of the qualifications to
progress in the direction I want to go.
If you would like to be part of the BePayroll series, please
email marketing@cipp.org.uk
BeKnowledgeable. BeDeveloped. BeRecognised. BeSupported. BeConnected.
14 | Professional in Payroll, Pensions and Reward | February 2021 | Issue 67You can also read
