"Payroll News"
New Payroll for 17th May 2006
The Budget in March 2006 specified a few changes to tax rates as from 18th May 2006. An update for the ABC5 Payroll is now available -- version 06-07 B1. A CD containing this update has been posted to ALL payroll users. This update has now been replaced by version 06-07 B2 which is included in the RECENT CHANGES update available on this website..
Changes to Payroll
The Payroll to finish up your 2005-2006 Year (ends 5th April 2006) is v05-06C1 and this is available on this website (included in the RECENT CHANGES update.)
The Year End function has been removed and you can continue using this payroll for the next few months to print reports or send your P14s/P35 electronically.
From 6th April 2006 use the new 2006-2007 Payroll. This is available from ABC Direct Sales, or your local support company. It is not available as a download from this website.
More than one Company?
You only need to update once; even if you have several different Company Payrolls set up on your ABC5 Accounts.
Network version
All updates are suitable for both single-user and network ABC5.
Tax Credits
You should not be paying any Tax Credits after March 2006 -- contact your local Tax Office if you have any queries.
Payroll Parameters
If you want to check the parameters that ABC Payroll is using to calculate PAYE and NI (eg. a visiting tax inspector may ask for this information) you can print the Payroll report LIST PARAMETERS.
General Notes
The National Insurance for Directors is calculated on the year as a whole, and if they are paid monthly this can lead to very uneven N.I. deductions (eg. nothing for the first few months, a large deduction for the next few months, and small amounts towards the end of the year). The Inland Revenue allows you to make the N.I. deductions more regular. With ABC Payroll the easiest way to do this is temporarily change the Director to be a normal employee for the first few months of the year (by removing the - D - from the employee record OPTIONS field). About halfway through the year you can put the - D - back into their Options Field, and the Payroll will correctly calculate their N.I. for the year as a whole.
It is not important exactly when you put the D back into their Options field, as long as you do it before the last Pay Run of the Year, so the Payroll can calculate their NI as a Director for the whole of the Year.
If an employee only becomes a Director partway through a Year, you need to keep the two parts of the year separate. You should therefore create a new Record Card for the person when they become a Director (and fill in the Director Start Week on the Record Card). At the end of the year they will get two P14s.
N.I.Adjustments/corrections
The ABC Payroll allows you to enter up to three corrections or adjustments to N.I. for each employee, in a year. You specify the Amount, give a note to explain the adjustment, and specify the Week Number in which this adjustment is to be applied. YOU MUST ENSURE that the Week Number you specify is going to be used by this employee in the future.
eg. if you specify Week 15, and employee is paid monthly on the last week of each month (eg. Week 8, Week 13, Week 17) then because they are not paid in Week 15 the NI Adjustment will not be activated.
To make it easy, we suggest you wait until you are just about to do a Pay Run (eg. for week 20), and then enter the N.I.Adjustment and specify this Week Number (ie. 20).
After-Tax Adjustments
There was an inconsistency over the way ABC handled After-Tax Adjustments on the printed reports and when updating the Accounts. This has now been changed (after discussions with users). Here is the way it now works:
ABC Payroll treats all After-Tax Adjustments as being between the Employee and the Employer, because this is what is shown on the Payslip.
If money is deducted/paid to the Employee for some outside purpose -- eg a court order on earnings -- then you must treat it as having first been paid to the Employer, and then later the Employer can pay it out to the external agency (from Heading 9221).
Electronic return of PAYE forms
The government is encouraging all businesses to submit their returns electronically, and will make this compulsory for even the smallest company by 2010. From 2005 small businesses will receive a payment from the government as an incentive to use electronic filing. The ABC Payroll does allow you to file electronically, and to receive this payment. The program that performs the electronic submission requires that you are running Windows 98/XP/2000 and that you are connected to the internet.
However, even if you are not running Windows or connected to the Internet, you can still send your End Of Year Retrun electronically and qualify for the Tax Free £250 incentive payment -- contact us for more details.
Inland Revenue Helpline and website
The government has provided a telephone Helpline for general enquiries about Tax and National Insurance. Available 8.30 to 5pm, Monday to Friday. Charged at local call rate: The number is: 0345 143 143
There is also an Internet website at www.inlandrevenue.gov.uk/employers