Employers: make sure you are up to date with key changes coming in the new Tax Year!
Changes are afoot! Annual changes to the National Minimum and Living Wages, Personal Tax Allowances, and Maternity and Paternity Pay are coming in April 2019. For all employers it’s time to get up to speed with what these changes will mean for you and your employees.
National Minimum Wage and National Living Wage
The National Minimum Wage and National Living Wage rates will increase on 1 April 2019. The rate depends on the employee’s age and whether they are an apprentice (if they are under 19 or in the first year of their apprenticeship, otherwise refer to age bands). The 2018 rates together with the rates as of April 2019 are detailed below:
Year 25 and over 21 to 24 18 to 20 Under 18 Apprentice
April 2018 £7.83 £7.38 £5.90 £4.20 £3.70
April 2019 £8.21 £7.70 £6.15 £4.35 £3.90
Further information on the National Minimum and Living Wages can be found on the gov.uk website: www.gov.uk/national-minimum-wage-rates
REMEMBER: if you have employees who are in receipt of Childcare Vouchers, they cannot salary sacrifice below these amounts, and you will need to adjust any Basic Earnings Assessment templates you may have used in the past to reflect the new personal tax allowance rates as detailed below.
Personal Tax Allowance
From 6 April 2019, the Personal Tax Allowance will be increased to £12,500. This is the amount you can earn before paying Income Tax. The basic rate limit will be increased to £37,500 and the higher rate threshold will be £50,000. These changes apply to non-savings, non-dividend income in England, Wales and Northern Ireland, and to savings and dividend income in the UK. The rates for 2019-20 are set out in the table below:
Band Taxable income Tax rate
Personal Allowance Up to £12,500 0%
Basic rate £12,501 – £50,000 20%
Higher rate £50,001 – £150,000 40%
Additional rate over £150,000 45%
Further information on the Personal Tax Allowance can be found on the gov.uk website: www.gov.uk/income-tax-rates
Note that since April 2017, the Scottish Parliament sets the basic rate limit and higher rate income thresholds for Scotland. Further information is available here: www.gov.uk/scottish-income-tax
Maternity, Paternity, Adoption and Shared Parental Pay rates
From 6 April 2019, the weekly rates for Statutory Maternity, Paternity, Adoption and Shared Parental Pay have increased to £148.68 (or 90% of the employee’s average weekly earnings, whichever is lower).
Information & Advice
If you would like further information on any of these changes, call Employers For Childcare’s Family Benefits Advice Service on Freephone 0800 028 3008. We will be updating our suite of factsheets for employers and parents, so keep an eye to our website and social media for updates.