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61 Friar Gate  Derby  DE1 1DJ

 

Registered to carry out audit work Association of Chartered Certified Accountants.

www.auditregister.org.uk under number 8011438

Member of the Association of Chartered Certified Accountants
Phone

01332 202660

Blog

Getting payroll right

Adrian Mooy - Saturday, November 30, 2019
 
Complying with payroll issues from salary to holiday entitlements, payslips to pensions is increasingly important for employers.

 

The National Minimum Wage and the National Living Wage

 

Since the establishment of the National Minimum Wage (NMW) in 1999, there have been constant changes to both rates and regulations, with perhaps the biggest being the introduction of the National Living Wage (NLW) in 2016.
 
The minimum wage is paid at an hourly rate, with payment bands depending on age, and special provisions applying to apprentices. The NLW is the minimum wage for those aged 25 and over, whilst the NMW applies to those above school leaving age and individuals aged under 25. For convenience, we refer to 'minimum wage' to cover both the NMW and the NLW.

 

Current minimum wage rates

 

Minimum wage rate    Rate from 1.4.19
NLW                            £8.21
21-24 year-old rate     £7.70
18-20 year-old rate     £6.15
16-17 year-old rate     £4.35
Apprentice rate           £3.90 

 

Failure to pay the minimum wage correctly can lead to penalties. A notice of underpayment will calculate the arrears of pay to be paid and the penalty set at 100% of the total underpayment, which can be doubled to 200%, unless the arrears are paid within 14 days. The maximum fine for non-payment is £20,000 per worker, and employers who fail to pay will be banned from being a company director for up to 15 years.

 

Payslips and holidays

 

Employees are legally entitled to receive a payslip showing their earnings before and after deductions. However, one in ten workers are not currently receiving a payslip. This makes it hard for them to calculate whether they are receiving the right level of pay, pension and holiday entitlement, and check Pay as You Earn (PAYE) deductions.
 
Around one in 20 workers receive no paid holiday entitlement, despite being legally entitled to at least 28 days' paid holiday a year. In addition, failure to offer staff workplace pensions under auto-enrolment rules can end in prosecution, with up to two years' imprisonment and unlimited fines possible.

 

Getting payroll right

 

Administering payroll and complying with the Real Time Information (RTI) regulations can be burdensome for businesses. The creation of customised payslips and the effective administration of PAYE, national insurance, Statutory Sick Pay and Statutory Maternity Pay is a time-consuming process. Many small and medium-sized enterprises (SMEs) may not have the resources or expertise to handle this themselves, but professional payroll services are available.

 

Working off-payroll

Adrian Mooy - Thursday, November 28, 2019
 
From 6 April 2020, there is a change to the off-payroll (IR35) rules.

 

The new rules will affect you if you work via your own personal service company. Clients are likely to investigate the profile of the contractor workforce more closely than before.

 

Contracts caught by the rules - The change could impact you if you supply personal services to large and medium organisations in the private and voluntary sector. If the client is a ‘small’ business, the rules are unchanged. A ‘small’ company meets two of these criteria: its annual turnover is not more than £10.2 million: it has not more than £5.1 million on its balance sheet: it has 50 or fewer employees.

 

Who decides? - Under the new rules, responsibility for making the decision as to whether IR35 rules apply passes to the business you contract for. The key question is whether, if your services were provided directly to that business, you would then be regarded as an employee. If you or your client use CEST, HMRC’s online check employment status for tax tool, HMRC undertakes to stand by the results if information provided is accurate, and given in good faith. In future, your client will have to provide you with the reasons for its status decision in a ‘Status Determination Statement’.

 

Implications - Significant tax implications arise. If IR35 applies, the business or agency paying you will calculate a ‘deemed payment’ based on the fees charged by your PSC. Broadly, this means you are taxed like an employee, receiving payment after deduction of PAYE and employee National Insurance Contributions. If you operate via a PSC, the PSC will receive the net amount, which you can then receive without further payment of PAYE or NICs.

 

Review your position - are clients likely to query your employment status? Should you consider restructured work arrangements, or renegotiating fees? If working via a PSC, is it still the best business model?

 

Using your car in your property rental business

Adrian Mooy - Wednesday, November 27, 2019

 

Landlords will often use their car for the purposes of their property rental business. Where they do so, they are able to claim a deduction for the costs that they incur.

 

Using mileage rates

 

Where a landlord uses their car for business purposes, the easiest way to work out the amount that can be deducted is to make use of the simplified expenses system and use the relevant mileage rates to claim a deduction based on the business mileage undertaken.

 

For cars (and also vans) the rate is set at 45p per mile for the first 10,000 business miles in the tax year and at 25p per mile for any subsequent business mileage.

 

Example

 

Karen is an unincorporated landlord and has three properties that she lets out. During the tax year, she undertakes 712 business miles in her own car in respect of her property business.

 

She claims a deduction of 45p per mile, a total deduction for the year of £320.40.

 

Deduction based on actual costs

 

The use of simplified expenses, while generally easier from an administration perspective, is not compulsory. The landlord can instead claim a deduction based on the actual costs. However, in practice this will be time consuming. Further, where the car is used for both business and private travel, a deduction is only permitted for the business element. Separating actual costs between business and private travel can be very time consuming and will only be worthwhile where it gives rise to a significantly higher deduction than that obtained by using the mileage rates.

 

Capital allowances

 

Capital allowances cannot be claimed where mileage allowances are claimed. Where a deduction is based on actual costs, capital allowances can be claimed in respect of the car. However, the claim must be adjusted to reflect any private use. So, for example, if a car is used for the purposes of the property business 20% of the time and for private use 80% of the claim, any capital allowance claim must be restricted to 20%.

 

Other travel

 

The costs of travel on public transport or by taxi can be deducted in computing the profits of the property rental business to the extent that it constitutes business travel for the purposes of that business.

Grounds and gardens for SDLT

Adrian Mooy - Tuesday, November 26, 2019
 
Stamp duty land tax (SDLT) on residential property also applies to land that form the garden or grounds of the property. To ensure that the right rate of SDLT is applied, it is therefore important to ascertain whether any land purchased with a property constitutes its garden or grounds. The rules here are not the same as those applying for capital gains tax private residence relief.

 

HMRC have recently updated their guidance in this area.

 

Status of the building

 

The first step in determining whether land is residential land is to determine the status of the associated building. If the building is a residential property for SDLT purposes, all land forming part of the ‘garden or grounds’ is residential property. Consequently, if at the time of purchase the property is not capable of being used as a dwelling, or is in the process of being constructed or adapted for residential use, the building is not residential property for SDLT purposes and any associated land is also not residential property.

 

Status of the land

 

Land that constitutes the ‘garden or grounds’ of a building which counts as residential property for SDLT purposes will also be residential property, and therefore subject to SDLT residential property rates, even if it is sold separately from the building.
The key date is the date of the transaction. However, past use of the land is taken into account by HMRC is order to establish the relationship between the land and the building. Future or planned future use is not relevant, although where use changes over time, the status of the land may also change.
 
No single factor

 

In deciding whether land counts as ‘garden or grounds’ a range of factors will come into play – there is no single determining factor. However, not all factors will carry equal weight. It is necessary to consider how the land is used.

 

Questions to ask include:

 

 • Is there evidence that the land has been actively and substantially exploited on a commercial basis?
 • If the activity could be for leisure or commercial purposes, such as beekeeping or equestrian use, is there evidence of commercial use?
 • Has a lease been granted to a third party for exclusive use of the land? This would suggest that the land is unlikely to be 'garden or grounds'.
 • Is the land of a type which would be expected to be ‘garden or grounds’ unless commercial use is established, such as land used as a paddock or orchard?
 • Is the land agricultural land which is sitting fallow? Such land is unlikely to be regarded as ‘garden or grounds’.
 
Outbuildings
 
The nature and layout of any outbuildings can be significant in determining whether land is ‘garden or grounds’. The presence of domestic outbuildings, areas laid out for hobbies, small orchards or stables and paddocks suitable for leisure use would indicate that the land is ‘garden or grounds’. However, the presence of commercial farming, commercial woodland, commercial equestrian use or other commercial use would suggest the contrary.
 
Size and proximity to dwelling

 

Physical proximity to the dwelling makes it more likely that the land is ‘garden or grounds’. However, land separated from the building may also fall into this category.

 

The size of the land in relation to the size of the building will also be relevant – a small cottage is unlikely to have a garden and grounds of many acres but a stately home may do.

 

The overall picture

 

In deciding the character of the land for SDLT purposes, it is necessary to look at the overall picture that emerges at the transaction date.

 

Joint tenants v tenants in common – Does it matter?

Adrian Mooy - Monday, November 25, 2019
 
There are two different ways of owning property jointly – as joint tenants or as tenants in common. The way in which the property is owned determines exactly who owns what and also what happens when one of the joint owners dies and how any income is taxed.
 
Joint tenants

 

Where two or more owners own a property as joint tenants, they jointly own the whole property rather than owning individual shares. Each owner has equal rights to the whole property. When one of the joint owners dies, the remaining joint owners own the whole property. The deceased is not able to pass his or her share on to someone else.

 

Example

 

Helen and Harry are married and own their family home as joint tenants. The couple have three children. If, for example, Harry dies first, his share of the property automatically passes to Helen. Harry cannot leave his share of the property to his children.
 
Where a property that is owned as joint tenants is rented out, the income is treated as arising in equal shares as all owners have an equal stake in the property. For spouses and civil partners this is the default position; however, there is no possibility of making a Form 17 election (see below) as the property owned as joint tenants can only be owned equally.

 

Tenants in common

 

Tenants in common own individual shares in the property and have more flexibility than joint tenants as to what they do with their stake in the property. On death, their stake does not automatically go to the other joint owners; rather it will follow the provisions of the will (or, if there is no will, the intestacy provisions).

 

It will be beneficial to own property as tenants in common if you want to leave your share of the property to someone other than the other joint owner.
 
Example

 

Jack and Jane are married. Each have children from previous relationships. They own a holiday cottage as tenants in common. In their wills, they have each made provision for their share to pass to their own children.

 

Where the property is let out, owing the property as tenants in common provides more flexibility as to how the income is allocated for tax purposes. Where the joint owners are spouses or civil partners, the income is treated as arising equally. However, where the actual beneficial ownership is unequal, they can elect (on Form 17) for the income to be taxed in accordance to their ownership shares where this is beneficial. If the tenants in common are not married or in a civil partnership, the income is taxed by reference to their actual stake in the property.

 

Changing ownership status

 

It is relatively easy to change the type of ownership, for example, if the property is owned as joint tenants it may be desirable to own it as tenants in common to enable each owner to leave their share to someone else. A property can also be changed from sole ownership to joint ownership – ether as tenants in common or joint tenants.

 

Directors’ loans – Beware of ‘bed and breakfasting’

Adrian Mooy - Sunday, November 24, 2019
 
It can make sense financially for directors of personal and family companies to borrow money from the company rather than from a commercial lender. Depending on when in the financial year the loan is taken out, it is possible to borrow up to £10,000 for up to 21 months without any tax consequences. However, if the loan remains outstanding beyond a certain point, tax charges will apply.

 

Company tax charge

 

In the event that a loan made to a director of a close company in an accounting period remains outstanding on the date when the corporation tax for that period is due, the company must pay a tax charge (‘section 455 tax’) on the outstanding value of the loan. The trigger date for the charge is the corporation tax due date of nine months and one day after the end of the accounting period. The amount of section 455 tax is 32.5% of loan remaining outstanding on the trigger date.

 

Traps to avoid

 

In days of old, it was relatively simple to prevent a section 455 charge from applying by clearing the loan balance just before the trigger date and, if the director still needed the loan, re-borrowing the funds shortly after the trigger date (bed and breakfasting). However, anti-avoidance provisions mean that as a strategy this is no longer effective.

 

Trap 1 – The 30-day rule

 

The 30-day rule comes into play where, within a period of 30 days of making a repayment of £5,000 or more, the director re-borrows money from the company. The rule effectively renders the repayment in-effective up to the level of the funds that are re-borrowed. Section 455 tax is charged on the lower of the amount repaid and the funds borrowed within a 30-day window.

 

Example

 

John is a director of his personal company J Ltd. The company prepares accounts to 31 January each year. In May 2018, John borrowed £8,000 from the company. On 28 October 2019, he repays the loan with money lent to him by his wife. On 7 November 2019, he re-borrows £7,000 from the company to enable him to pay his wife back. He does not make any further borrowings in November 2019.

 

Corporation tax for the year to 31 January 2019 is due on 1 November 2019. Although the director’s loan is not outstanding on that date, the 30-day rule bites and only £1,000 of the repayment made on 28 October 2019 is effective -- £7,000 of the £8,000 paid back is re-borrowed within 30 days. Consequently, the section 455 charge applies to £7,000 – the lower of the repayment and the funds borrowed within 30-days of the repayment – and the company must pay section 455 tax of £2,275 (32.5% of £7,000).

 

Avoiding the trap

 

The 30-day rule can be avoided if the company pays the director a dividend, bonus or any other payment that’s taxable and this is used to repay part or all of a loan. In this situation, it’s OK to take another loan from the company within 30 days without the anti-avoidance rule being triggered. Keeping repayments and re-borrowings below £5,000 will also prevent the 30-day rule from biting.

 

Trap 2 – Intentions and arrangements rule

 

The ‘intention and arrangements’ rule applies where the balance of the loan outstanding immediately before the repayment is at least £15,000, and at the time a loan repayment is made there are arrangements, or an intention, to subsequently borrow £5,000.
 
This rule applies even where the new borrowing is outside 30 days. The rule bites if the repayment is made with the intention of redrawing at least £5,000 of the payment, irrespective of when this is done. Again, the rule does not apply to funds extracted by way of a dividend or bonus as these are within the charge to income tax.

 

Plan repayments carefully

 

Where looking to repay loans to prevent a section 455 charge from arising, these should be planned carefully to avoid falling foul of the traps.

 

Can we deduct entertaining expenses?

Adrian Mooy - Saturday, November 23, 2019
 
The tax rules on the deductibility of entertaining expenses are harsh and often misunderstood – the fact that the expenditure is incurred for businesses purposes does not make it deductible. Subject to certain limited exceptions, no deduction is allowed for business entertaining and gifts in calculating taxable profits.
 
What counts as business entertainment?
 
Business entertainment is the provision of free or subsidised hospitality or entertainment. Hospitality includes the provision of food drink or similar benefits for which no payment is made by the recipient. It also extends to subsidised hospitality whereby the charge made to the recipient does not cover the costs of providing the entertainment or hospitality.

 

Examples of business entertaining would include taking a supplier to lunch, taking customers to a day at the races, or inviting them to a box at rugby match, and suchlike. The definition is wide.

 

Exception 1: Entertaining employees

 

One of the main exceptions to the general rule that entertaining expenses cannot be deducted is in relation to staff entertainment. A deduction is allowed for the cost of entertaining staff, as long as the costs are incurred wholly and exclusively for the purposes of the trade and the entertaining of the staff is not merely incidental to the entertaining of customers. So, for example, a company would be able to deduct the cost of the staff Christmas party in calculating its taxable profits. However, if a company takes customers to Wimbledon, the fact that a number of employees also attended is not enough to guarantee a deduction as the entertaining provided for the employees is incidental to that for customers.
 
It should be noted that unless an exemption is in point, employees may suffer a benefit in kind tax charge on any entertainment provided.

 

Exception 2: Normal course of trade

 

The disallowance does not apply where the business is that of providing hospitality, and as such a deduction is allowed for the costs incurred in providing that hospitality as long as they are incurred wholly and exclusively for the purposes of the business. Businesses such as restaurants and events management companies would fall into this category.

 

Exception 3: Contractual obligation to provide entertainment

 

Where entertainment is provided under a contractual obligation, this is not treated as business entertainment and a deduction is allowed for the cost. A common example would be where hospitality is provided as part of a package. However, the business should be able to demonstrate that they have received a full return for the entertainment provided.

 

Exception 4: Small gifts carrying an advert

 

The provision of business gifts is treated as business entertaining with the result that a deduction for the costs is not generally allowed. However, there is an exception for gifts costing not more than £50 per year per recipient which bear a conspicuous advert for the business. An example of a deductible gift would be a diary or a water bottle featuring an advert for the business.

 

Remember…
Just because entertaining is incurred for business purposes does not mean that it is allowable – business entertaining needs to be added back in the corporation tax computation.

 

Zero charge for zero emission cars

Adrian Mooy - Friday, November 22, 2019

 

From 6 April 2020, the way in which carbon dioxide emissions for cars are measured is changing – moving from the New European Driving Cycle (NEDC) (used for cars registered prior to 6 April 2020) to the Worldwide Light Testing Procedure (WLTP) for cars registered on or after 6 April 2020.

 

For an introductory period, the appropriate percentages for cars registered on or after 6 April 2020 are reduced – being two percentage points lower than cars with the same CO2 emissions registered prior to 6 April 2020 for 2020/21 and one percentage point lower for 2021/22. From 2022/23 the appropriate percentages are aligned regardless of which method is used to determine the emissions.

 

Zero emission cars

 

As part of the transition, the appropriate percentage for zero emission cars is reduced to 0% for 2020/21 and to 1% for 2021/22. This applies regardless of when the car was registered.

 

The charge was originally set at 2% for 2020/21 and 2021/22, and will revert to this level from 2022/23.

 

Impact

 

Electric company car drivers were already set to enjoy a tax reduction. The appropriate percentage for 2019/20 is 16% and was due to fall to 2% from 6 April 2020. However, the further reduction to 0% means that those who have opted for an electric company car can enjoy the benefit tax-free in 2020/21. Their employers will also be relieved of the associated Class 1A National Insurance charge.

 

Case study

 

Kim has an electric company car throughout 2019/20, 2020/21 and 2021/22. The car has a list price of £32,000. Kim is a higher rate taxpayer.

 

In 2019/20, Kim is taxed on 16% of the list price – a taxable benefit of £5,120. As a higher rate taxpayer, the tax hit is £2,048 (40% of £5,120). Her employer must also pay Class 1 National Insurance of 13.8% on the taxable amount (£706.56).

 

In 2020/21, the appropriate percentage is 0% so there is no tax or Class 1A National Insurance to pay. This is a significant reduction compared to 2019/20. In 2021/22, the charge is 1% of the list price, equal to £320, on which the tax is £128 (assuming a 40% tax rate) and the Class 1A National Insurance is £44.16.

 

From 2021/22 the charge is 2% of the list price – equal to £640. Not quite zero emissions It is also possible to enjoy a company car tax-free in 2020/21 if it is registered on or after 6 April 2020, has emissions of between 1 and 50g/km (measured under the WLTP) and an electric range of at least 130 miles. Go electric The benefits of choosing electric cars from a tax perspective, as well as from an environmental one, are significant.

 

Not quite zero emissions

 

It is also possible to enjoy a company car tax-free in 2020/21 if it is registered on or after 6 April 2020, has emissions of between 1 and 50g/km (measured under the WLTP) and an electric range of at least 130 miles.

 

Go electric

 

The benefits of choosing electric cars from a tax perspective, as well as from an environmental one, are significant.

Self-employed – How to calculate your payments on account

Adrian Mooy - Thursday, November 21, 2019
 
The deadline for filing the self-assessment tax return for 2018/19 is 31 January 2020. This is also the date by which any outstanding tax for 2018/19 must be paid and, where payments need to be made on account, the date by which the first payment on account of the 2019/20 liability must be made.
 
What is a payment on account?
 
As the name suggest, a payment on account is an advance payment towards a taxpayer’s tax and Class 4 National Insurance bill. Where payments on account are due, the tax is payable in two instalments on 1 January in the tax year and on 31 July after the tax year rather than in full in a single instalment of 31 January after the tax year.

 

As the payments on account are based on the previous year’s liability, it is not an exact science – there may be more tax to pay or the taxpayer may have paid too much. Any balancing payment must be made by 31 January after the end of the tax year. If the taxpayer has paid too much, the excess will normally be set against the next year’s payments on account or refunded if none are due.

 

When must payments on account be made?

 

Payments on account must be made where tax and Class 4 National Insurance for the previous tax year was £1,000 or more, unless at least 80% of the tax owed has been deducted at source, for example under PAYE.
Payments on account are not required when tax and Class 4 National Insurance bill for the previous year was less than £1,000.
 
Calculating the payments on account

 

Each payment on account is 50% of the previous year’s tax and Class 4 National Insurance liability.

 

Class 2 National Insurance contributions are not taken into account in calculating the payments on account and must be paid in full by 31 January after the end of the tax year.

 

Example

 

Richard is a sole trader. In 2018/19 his profits from self-employment were £30,000. He has no other income.
 
His income tax liability for 2018/19 is £3,630 (20% (£30,000 - £11,850)) and his Class 4 National Insurance liability is £1,941.84 (9% (£30,000 - £8,424).
 
His combined tax and Class 4 National Insurance liability is thus £5771.84.
 
As this is more than £1,000, he must make payments on account of the 2019/20 tax year of £2,785.92 on 1 January 2020 and 31 July 2020. Each payment is 50% of the previous year’s liability of £5771.84. If the liability for 2019/20 is more than £5,771.84, the balance must be paid by 31 January 2021, together with
the Class 2 National Insurance for 2019/20.
 
Beware fluctuating years
 
Where the tax and Class 4 liability is under £1,000 one year but not the next, the payments can fluctuate widely – this may hit the taxpayer hard.
 
Example
 
Tim has a tax and Class 4 National Insurance liability of £900 in 2017/18. As a result, he is not required to make payments on account for 2018/19. However, 2018/19 is a good year and his tax and National Insurance liability is £4,000. As payments on account were not made, the amount is due in full by 31 January 2020. Also, because it is more than £1,000, he must make payments on account for 2019/20.

 

As a result, he has to pay £6,000 on 31 January 2019 – the full liability for 2018/19 (£4,000) and the first payment on account of £2,000 (50% of £4,000) for 2019/20. The second payment on account for 2019/20 of £2,000 is due by 31 July 2020.

 

Reduce payments on account

 

If the taxpayer knows that income in the current year will be less than the previous year, they can ask HMRC to reduce the payments on account. However, interest is charged on the shortfall if the payments are reduced below the level they should be.

 

Employer-funded scholarships

Adrian Mooy - Wednesday, November 20, 2019
 
Special tax rules apply to scholarships, which include exhibitions, bursaries or other similar education endowments.
 
Provided certain conditions are met, there will be no tax or reporting implications where an employer funds a ‘fortuitous’ scholarship for an employee’s family member. Broadly, this means that there must be no direct connection between the employee working for the employer and their family member getting the scholarship.

 

A scholarship is 'fortuitous' if all the following apply:

 

 • the person with the scholarship is in full-time education
 • the scholarship would still have gone to that person even if their family member did not work for the employer
 • the scholarship is run from a trust fund or under a scheme
 • 25% or fewer of the payments made by the fund or scheme are for employment-linked scholarships
 
If the scholarship does not qualify for exemption, the employer must report it to HMRC on form P11D and pay Class 1A NICs on the cost of providing it.
 
Unfortunately, in a family company, directors’ children are unable to take advantage of this provision because the tax legislation deems there to be a benefit in kind. However, in some circumstances a remoter relative (for example a grandparent) could establish such a scheme provided that the student was validly employed and their parents are not involved with the company.
 
Sandwich courses
 
An employee in full-time employment may leave that employment for a period to attend an educational establishment but continue to receive payments from their employer, for example where the employee is on a ‘sandwich’ course. Such payments will be treated as exempt from income tax, provided the following conditions are satisfied:

 

1. The employer must require the employee to be enrolled at the educational establishment for at least one academic year and to attend the course for at least 20 weeks in that academic year. If the course is longer, the employee must attend for at least 20 weeks on average, in an academic year over the period of the course.

 

2. The establishment must be a recognised university, technical college or ‘similar educational establishment’, open to the public and offering more than one course of practical or academic instruction.

 

3. The payments must not exceed a specified maximum figure for the academic year. This figure must include lodging, subsistence and travel allowances but does not include any tuition fees payable to the establishment by the employee. Note that:
(a) the exemption can apply to payments of earnings payable to the student for periods spent studying at the educational establishment
(b) it cannot, however, cover payments made for any periods spent working for the employer, whether during vacations or otherwise
(c) the current maximum figure is £15,480 per academic year
(d) in principle, the limit is all or nothing: if it is breached then the whole amount is taxable. However, if an increased payment is made during the academic year then this does not invalidate earlier payments made within the agreed limit
 
Qualifying payments will also be exempt for Class 1 National Insurance Contributions purposes.
 
Example

 

Jack’s employer pays for him to attend college on a course that starts in September 2018 and finishes at the end of the academic year in June 2019. Jack works for his employer over the Christmas and Easter periods, during which he is paid his normal monthly salary. His income while working during holidays will be subject to tax and Class 1 NICs, because the exemption only applies to income when attending college.

 

Jack’s employer pays him £3,000 in September 2018 for the first term of the academic year followed by two further payments of £3,000 each in January 2 and April 2019 to cover terms 2 and 3. These three amounts of £3,000 each will be exempt from tax and NICs because they meet the qualifying conditions, including being less than the financial ceiling of £15,480.

 


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