New tax year brings key changes

The minimum wage rules where saw an important on 1 April 2021. Since then, the qualifying age for receiving the National Living Wage is 23, reduced from 25. Plus, the  National Living Wage and National Minimum Wage both increased from the same date. Details of the new rates can be found here.  

The long-delayed changes to the off-payroll (IR35) rules took affect on 6 April. Individuals who provide their services through an intermediary, e.g. a company or partnership, in which they own an interest are no longer be responsible for deciding if IR35 applies where their client is a medium-sized or large organisation. Extensive guidance on the new rules is available from HMRC’s website here.

Employers now need to keep their eyes open for a new student loan form which applies to Scottish taxpayers. Employers should have been notified by the issue of a Form SL1 to switch employees with Scottish student loans from Plan 1 to Plan 4 for payroll runs on or after 6 April 2021. For new employees, employers must use the latest “starter checklist” which includes updated questions about student loans. The new form can be downloaded from HMRC’s site here.

While the new VAT reverse charge for building and construction services has applied since 1 March 2021, the full effects are only starting to hit home as businesses whose VAT quarter ended on 31 March, are due to submit their returns at the end of April. HMRC’s technical guide on the scheme, available here, explains how to report and account for the charge.