Transparency data: Workforce management information for HMRC and the VOA: 2017

Updated: Data for February 2017 added

Data covers:

  • payroll staff by grade
  • non-payroll staff by type headcount staff numbers
  • full-time equivalent staff numbers
  • staff costs

Notes

These figures are not official statistics. They are internal workforce management information published in the interests of transparency.

These figures have not been reconciled centrally with any National Statistics. Where differences appear between the monthly information and National Statistics, clarifying comments will be provided. The Office for National Statistics quarterly public sector employment statistics provide an official headline measure for comparing the overall size of employment in central government organisations with other sectors of the economy at the relevant quarterly reference point.

Some organisations may not have information available for each month, and at this stage coverage may therefore not reach 100% for those organisations in scope. Given the wide range of organisations covered, caution should be exercised when drawing inferences from the figures and care should be taken when making comparisons between organisations.

Data on staff numbers are a snapshot of the last day in the relevant period. For example, the data for 2010 to 2011 relate to 31 March 2011, and the data for April 2011 relate to 30 April 2011.

Data on staff costs are for the whole of the relevant period. For example, the data for 2010 to 2011 cover the entire financial year, while data for April 2011 reflect the total staff cost incurred in that month.

Source: HMRC

Policy paper: Draft legislation: the Corporate Interest Restriction (Consequential Amendments) Regulations 2017

Updated: Updated to explain that the corporate interest restriction schedule has been removed from the Finance Bill 2017.

The Corporate Interest Restriction (CIR) legislation was included in Schedule 10 of Finance Bill 2017 but has now been removed. There has been no policy change and the government has announced it will legislate for the provisions at the earliest opportunity in the next Parliament.

The CIR rules limit the tax relief that large multinational businesses can claim for interest and other financing expenses.

Regulations are needed to ensure the rules relating to collective investment vehicles and securitisation companies continue to operate as intended under the CIR rules. HM Revenue and Customs published draft regulations, together with a draft explanatory memorandum, for a period of consultation which closed on 18 April 2017.

A consultation on how the CIR rules should operate was opened in May 2016 and the government’s response to this was published in December 2016.

A tax information and impact note has been published for this measure. The final legislation was included in schedule 10 of the Finance (No. 2) Bill 2017.

You can find out more about the CIR rules by reading the draft guidance.

Source: HMRC

Guidance: Rates and allowances: Inheritance Tax thresholds and interest rates

Updated: This guidance has been updated to reflect Inheritance Tax threshold effective from 6 April 2017.

The attached document is classified by HM Revenue and Customs as guidance and contains information of the different thresholds in use for deaths going back to 1914.

It also shows the changes in Inheritance Tax interest rates from October 1988.

You can use this information to calculate how much interest is due on an Inheritance Tax payment by using the Inheritance Tax interest calculator.

Source: HMRC

Detailed guide: Rates and thresholds for employers 2017 to 2018

Updated: Company cars: Advisory Fuel Rates (AFRs) have been updated.

Unless otherwise stated, the figures quoted apply between 6 April 2017 and 5 April 2018.

PAYE tax and Class 1 National Insurance contributions

You normally operate PAYE as part of your payroll so HM Revenue and Customs (HMRC) can collect Income Tax and National Insurance from your employees.

Your payroll software will calculate how much tax and National Insurance to deduct from your employees’ pay.

Tax thresholds, rates and codes

The amount of Income Tax you deduct from your employees depends on their tax code and how much of their taxable income is above their Personal Allowance.

PAYE tax rates, thresholds and codes 2017 to 2018
Employee personal allowance £221 per week
£958 per month
£11,500 per year
UK Basic tax rate 20% on annual earnings above the PAYE tax threshold and up to £33,500
UK Higher tax rate 40% on annual earnings from £33,501 to £150,000
UK Additional tax rate 45% on annual earnings above £150,000
Scottish Basic tax rate 20% on annual earnings above the PAYE tax threshold and up to £31,500
Scottish Higher tax rate 40% on annual earnings from £31,501 to £150,000
Scottish Additional tax rate 45% on annual earnings above £150,000
Emergency tax codes 1150L W1, 1150L M1 or 1150L X

Class 1 National Insurance thresholds

You can only make National Insurance deductions on earnings above the Lower Earnings Limit (LEL).

Class 1 National Insurance thresholds 2017 to 2018
Lower Earnings Limit (LEL) £113 per week
£490 per month
£5,876 per year
Primary Threshold (PT) £157 per week
£680 per month
£8,164 per year
Secondary Threshold (ST) £157 per week
£680 per month
£8,164 per year
Upper Secondary Threshold (under 21) (UST) £866 per week
£3,750 per month
£45,000 per year
Apprentice Upper Secondary Threshold (apprentice under 25) (AUST) £866 per week
£3,750 per month
£45,000 per year
Upper Earnings Limit (UEL) £866 per week
£3,750 per month
£45,000 per year

Class 1 National Insurance rates

Employee (primary) contribution rates

Deduct primary contributions (employee’s National Insurance) from your employees’ pay through PAYE.

National Insurance category letter Earnings at or above LEL up to and including PT Earnings above the PT up to and including UEL Balance of earnings above UEL
A 0% 12% 2%
B 0% 5.85% 2%
C NIL NIL NIL
H (Apprentice under 25) 0% 12% 2%
J 0% 2% 2%
M (under 21) 0% 12% 2%
Z (under 21 – deferment) 0% 2% 2%

Employer (secondary) contribution rates

You pay secondary contributions (employer’s National Insurance) to HMRC as part of your PAYE bill.

Pay employers’ PAYE tax and National Insurance.

National Insurance category letter Earnings at or above LEL up to and including ST Earnings above ST up to and including UEL/UST/AUST Balance of earnings above UEL/UST/AUST
A 0% 13.80% 13.80%
B 0% 13.80% 13.80 %
C 0% 13.80% 13.80%
H (Apprentice under 25) 0% 0% 13.80%
J 0% 13.80% 13.80%
M (under 21) 0% 0% 13.80%
Z (under 21 – deferment) 0% 0% 13.80%

Class 1A National Insurance: expenses and benefits

You must pay Class 1A National Insurance on work benefits you give to your employees, example a company mobile phone. You report and pay Class 1A at the end of each tax year.

NI class 2017 to 2018 rate
Class 1A 13.8%

Pay employers’ Class 1A National Insurance.

Class 1B National Insurance: PAYE Settlement Agreements (PSAs)

You pay Class 1B National Insurance if you have a PSA. This allows you to make one annual payment to cover all the tax and National Insurance due on small or irregular taxable expenses or benefits for your employees.

National Insurance class 2017 to 2018 rate
Class 1B 13.8%

Pay Class 1B National Insurance.

National Minimum Wage

The National Minimum Wage is the minimum pay per hour almost all workers are entitled to by law. Use the National Minimum Wage calculator to check if you’re paying a worker the National Minimum Wage or if you owe them payments from past years.

The rates below apply from 1 April 2017.

Category of worker Hourly rate
Aged 25 and above (national living wage rate) £7.50
Aged 21 to 24 inclusive £7.05
Aged 18 to 20 inclusive £5.60
Aged under 18 (but above compulsory school leaving age) £4.05
Apprentices aged under 19 £3.50
Apprentices aged 19 and over, but in the first year of their apprenticeship £3.50

See National Minimum Wage rates for previous years.

Statutory maternity, paternity, adoption and shared parental pay

Use the maternity and paternity calculator for employers to calculate your employee’s Statutory maternity pay (SMP), paternity or adoption pay, their qualifying week, average weekly earnings and leave period.

Type of payment or recovery 2017 to 2018 rate
SMP – weekly rate for first six weeks 90% of the employee’s average weekly earnings
SMP – weekly rate for remaining weeks £140.98 or 90% of the employee’s average weekly earnings, whichever is lower
Statutory paternity pay (SPP) – weekly rate £140.98 or 90% of the employee’s average weekly earnings, whichever is lower
Statutory adoption pay (SAP) – weekly rate for first six weeks 90% of employee’s average weekly earnings
SAP – weekly rate for remaining weeks £140.98 or 90% of the employee’s average weekly earnings, whichever is lower
Statutory shared parental pay (ShPP) – weekly rate £140.98 or 90% of the employee’s average weekly earnings, whichever is lower
SMP/SPP/ShPP/SAP – proportion of your payments you can recover from HMRC 92% if your total Class 1 National Insurance (both employee and employer contributions) is above £45,000 for the previous tax year

103% if your total Class 1 National Insurance for the previous tax year is £45,000 or lower

Statutory Sick Pay (SSP)

The same weekly SSP rate applies to all employees. However, the amount you must actually pay an employee for each day they’re off work due to illness (the daily rate) depends on the number of ‘qualifying days’ (QDs) they work each week.

Use the SSP calculator to work out your employee’s sick pay, or use the rates below.

Unrounded daily rates Number of QDs in week 1 day to pay 2 days to pay 3 days to pay 4 days to pay 5 days to pay 6 days to pay 7 days to pay
£12.7642 7 £12.77 £25.53 £38.30 £51.06 £63.83 £76.59 £89.35
£14.8916 6 £14.90 £29.79 £44.68 £59.57 £74.46 £89.35  
£17.8700 5 £17.87 £35.74 £53.61 £71.48 £89.35    
£22.3375 4 £22.34 £44.68 £67.02 £89.35      
£29.7833 3 £29.79 £59.57 £89.35        
£44.6750 2 £44.68 £89.35          
£89.3500 1 £89.35            

Student loan recovery

If your employees’ earnings are above the earnings threshold, record their student loan deductions in your payroll software. It will automatically calculate and deduct repayments from their pay.

Rate or threshold 2017 to 2018 rate
Employee earnings threshold for Plan 1 £17,775 per year
£1,481 per month
£341 per week
Employee earnings threshold for Plan 2 £21,000 per year
£1,750 per month
£403 per week
Student loan deductions 9%

Company cars: Advisory Fuel Rates (AFRs)

Use AFRs to work out mileage costs if you provide company cars to your employees.

The rates below apply from 1 June 2017.

Engine size Petrol – amount per mile LPG – amount per mile
1400cc or less 11 pence 7 pence
1401cc to 2000cc 14 pence 9 pence
Over 2000cc 21 pence 14 pence
Engine size Diesel – amount per mile
1600cc or less 9 pence
1601cc to 2000cc 11 pence
Over 2000cc 13 pence

Hybrid cars are treated as either petrol or diesel cars for this purpose.

Employee vehicles: Mileage Allowance Payments (MAPs)

MAPs are what you pay your employees for using their own vehicle for business journeys.

You can pay your employees an ‘approved amount’ of MAPs each year without having to report them to HMRC. To work out the ‘approved amount’, multiply your employee’s business travel miles for the year by the rate per mile for their vehicle.

Find out more about reporting and paying MAPs.

Type of vehicle Rate per business mile 2017 to 2018
Car For tax purposes: 45 pence for the first 10,000 business miles in a tax year, then 25 pence for each subsequent mile

For National Insurance purposes: 45 pence for all business miles

Motorcycle 24 pence for both tax and National Insurance purposes and for all business miles
Cycle 20 pence for both tax and National Insurance purposes and for all business miles

Source: HMRC

Detailed guide: Off-payroll working in the public sector: reform of intermediaries legislation

Updated: This guide was updated to clarify how off-payroll working in the public sector rules apply to businesses that provide ophthalmic and pharmaceutical services.

Intermediaries legislation changes

From 6 April 2017 there are changes to the way the current intermediaries legislation (known as IR35) is applied to off-payroll working in the public sector. Where the rules apply, people who work in the public sector through an intermediary will pay employment taxes in a similar way to employees.

Who the changes affect

These changes will apply to:

  • public authorities who hire off-payroll contractors
  • public sector tax managers, payroll managers, human resources managers and procurement managers
  • agencies and third parties who supply contractors to the public sector
  • contractors who provide their services to a public authority through an intermediary

When the changes take effect

The reform applies to payments made on or after 6 April 2017, including payments made for contracts entered into before that date.

Where work is completed before 6 April 2017 but the payment is made on or after 6 April 2017, the rules still apply.

How the reform works in practice

The responsibility for deciding if the legislation should be applied, shifts from the worker’s intermediary to the public authority the worker is supplying their services to.

Where the rules apply, the fee-payer (the public authority, agency, or other third party paying the intermediary) will calculate Income Tax and primary (employee) National Insurance contributions (NICs) and pay them over to HMRC. These amounts will be deducted from the intermediary’s fee for the work provided.

The worker’s intermediary is able to set against its own Income Tax and NICs liability in the tax year, an amount equivalent to the payment received from the fee-payer which has already had Income Tax and NICs deducted.

Responsibilities

The key responsibilities are split as follows.

A worker working through a Personal Service Company (PSC) or other intermediary is responsible for:

  • providing the fee-payer (public sector client, agency, or other third party) with the information they need to help determine whether the off-payroll working in the public sector rules should apply
  • where the off-payroll working in the public sector rules apply, provide the fee-payer with the information required to allow them to deduct tax and NICs from the payment they make to the intermediary
  • reporting to HMRC on own, and company’s tax affairs

A public authority, agency or third party acting as the fee-payer is responsible for:

  • operating employment taxes associated with the contract
  • paying the deemed direct payment to the PSC
  • reporting to HMRC through Real Time Information (RTI) the employment taxes deducted
  • paying relevant employers’ NICs

A public authority is responsible for:

  • determining whether off-payroll working in the public sector rules should apply initially and when there are contractual changes, as the party engaging the worker for a specific task or role
  • where they are using an agency or other third party to provide labour, notifying them whether off-payroll working in the public sector rules should apply to the contract they have with the worker
  • for contracts starting after 6 April 2017, notifying their decision before entering into the contract or before the provision of services begins – if it fails to do so, it becomes responsible for accounting for PAYE as if it were a fee-payer
  • for contracts in place before 6 April 2017, their decision should be notified before the first payment after 6 April 2017 – if it fails to do so, the public authority becomes responsible for accounting for PAYE as if it were a fee-payer
  • replying within 31 days to a written request from an agency or other third party as to whether off-payroll working in the public sector rules apply and setting out the reasons why – if it fails to do so, it becomes responsible for accounting for PAYE as if it were a fee-payer

Public authorities

For the purpose of this reform, a public authority means a public authority as defined for the purposes of the Freedom of Information Act 2000 and the Freedom of Information (Scotland) Act 2002.

This definition covers government departments and their executive agencies, many companies owned or controlled by the public sector, universities, local authorities, parish councils and the National Health Service (NHS). The Acts cover England, Scotland, Wales and Northern Ireland. Some cross-border public bodies in Northern Ireland are outside the Freedom of Information Act 2000. It also applies to the UK Parliament, and the National Assembly for Wales Commission and Northern Ireland Assembly Commission.

Detailed guidance has been published that helps public authorities understand how these reforms will change the way they pay for workers affected by these changes. Depending on the size and type of public sector organisation there might be a number of people who are involved with the implementation of, or who need to know about the impacts of the changes.

Businesses that provide ophthalmic and pharmaceutical services

Retail businesses providing ophthalmic and pharmaceutical services for the NHS will not need to consider whether to apply the off-payroll working in the public sector rules to contractors working for them through an intermediary.

The definition of public authority retains the need for NHS hospitals to consider whether to apply the off-payroll working in the public sector rules to all contractors working for them through an intermediary. This includes contractors who are providing ophthalmic and pharmaceutical services through an intermediary.

The definition of public authority includes General Practitioner (GP) surgeries and dental practices or surgeries providing NHS medical and dental services. These entities are required to consider whether the off-payroll working in the public sector rules should be applied to contractors working for them through an intermediary.

Roles

The following list is not a definitive guide but should help public sector organisations to know, who might need further information. Public sector organisations might combine some of the duties outlined below into fewer teams.

Hiring teams: will need to know whether the post they are looking to fill is likely to be subject to these reforms. People applying, through their own intermediaries will need to know the tax implications in advance.

Where hiring teams use an employment agency, or other third-party to supply labour they will need to tell them if the rules apply for the positions they are filling.

Procurement teams: where the rules apply, procurement teams may want, or need to change existing contracts and draft future contracts to reflect changes in how invoices from such intermediaries will be paid.

Payroll teams: where the reforms apply, tax and national insurance will be deducted from fees, and reported and paid over to HMRC in real time. Depending on the organisation’s payroll and accounts arrangements, some internal changes to processes may be required to make that happen.

Employer’s national insurance will also be payable by your organisation.

Accounts payable teams: invoices received from intermediaries affected by these changes will need to be paid net of tax and national insurance. Depending on your organisation’s payroll and accounts arrangements, accounts payable teams may need to make some internal changes to processes to make that happen.

VAT may also be payable on the gross amount of the invoice.

Finance teams: these reforms will change the costs involved in engaging workers through intermediaries.

Chief accounting officers: HM Treasury rules on procurement will remain in place as will the responsibilities they include.

What can be done to implement the change

Public authorities, agencies and third parties supplying contractors should consider existing contracts and prepare for the change.

It is for the public authority to determine whether off-payroll working in the public sector rules apply when engaging a worker through a PSC.

Guidance for individuals paid through PSCs
and fee-payers is available.

Further guidance setting out whether contracts are in scope or out of scope, covering managed service companies and contracted out services is available.

Check employment status for tax service

Interested parties can use the check employment status for tax service to obtain the HMRC view of whether any current and prospective workers would fall within the off-payroll working in the public sector rules from 6 April 2017.

This new digital service provides the HMRC view of the employment status of a worker. The user answers a number of questions around the relationship between the worker and the public sector client they are contracted with. It is for the public authority to decide whether off-payroll working in the public sector rules should apply.

Use of the service is optional.

Determination of employment status

Where a worker’s PSC or other intermediary they work through has entered into the contract to provide the worker’s services to a public sector client, it is for the public sector client to determine if the off-payroll working in the public sector rules should apply.

If a worker thinks they have been taxed incorrectly, they can submit a repayment claim to HMRC. HMRC will then determine if they are due a repayment of Income Tax or NICs and repay as appropriate. Please refer to guidance on tax overpayments and underpayments.

Legislation, guidance and technical information:

Source: HMRC