George Osborne has delivered his eighth Budget as chancellor.  This guide summarises the impact of the Chancellor’s budget 2016  on a number of HR related areas.
1.  Pay – Income tax thresholds
Personal allowances will increase from £11,000 in 2016-17 to £11,500 in 2017-18.  This will ensure that no one working 30 hours per week on the national minimum wage will pay income tax in 2017-18.  In addition, the higher-rate tax threshold will increase from £42,385 to £45,000 in April 2017.
2.  Terminations – Redundancy payments
From 2018, termination payments of more than £30,000 will be subject to employer national insurance contributions.  The majority of redundancy payments are currently exempt from employee and employer national insurance contributions with the first £30,000 being tax free.

3.  Employee benefits – Childcare vouchers

The budget confirmed that childcare vouchers will be closed to new entrants from April 2018 when the new Tax-Free Childcare (TFC) initiative is launched.

4.  Apprenticeships – Apprenticeship levy

From April 2017, employers will receive a 10 per cent top-up on their monthly levy contributions in England, available to spend on apprenticeship training through their on-line account.  Further details on this are due to be published in June.

For more information, contact Ramshaw HR to find our more about our services.

 

By Bruce Ramshaw

Principal Consultant

ramshwhr.com

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