axis payroll User Guide Supplement March 2017 |
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1. What's New? |
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1.1 axis payroll and RTI |
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The March 2017 axis payroll Legislation Update includes all of the required software changes to meet the latest requirements for RTI. Please ensure you read the whole of the axis payroll User Guide Supplement March 2017 prior to installing the update and running your year end procedures. |
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1.2 2017-18 Tax Year End and RTI |
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All employers were required to report PAYE in real time from the first payday on or after 6 April 2013. Reporting PAYE in real time (RTI) means that you send HMRC data about tax, NICs and other deductions using the axis payroll software on or before each earnings payment is made rather than at the end of the tax year. The information you send tells HMRC how much you should pay to them. You report your payroll information by submitting RTI Full Payment Submissions (FPS) as part of each payroll run you make in your axis payroll software. If you need to offset any statutory payments, for example Statutory Maternity Pay, you will also submit a single RTI Employer Payment Summary (EPS) from one of your data sets within 14 days of that particular tax month/quarter i.e. by 19th so that HMRC can reconcile your payment to the figures submitted. RTI also means that you file year end information by submitting a final EPS for the year which contains all of the required end of year information for HMRC. Further information on PAYE final submission for the year and end of year tasks is available from HM Revenue and Customs at http://www.hmrc.gov.uk/payerti/end-of-year/tasks.htm Futher information regarding the creation and submission of RTI information from your axis payroll software is provided in the F1 function help for the relevant functions. |
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1.3 Apprenticeship Levy |
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From 6th April 2017, the Government is introducing an Apprenticeship Levy to help to fund and grow the apprenticeship programme. The levy applies to all employers operating in the UK and is charged at 0.5% of an employer's annual pay bill. However, an annual levy allowance of £15,000 is available to each employer to offset their liability. As a result, only employers with an annual pay bill of over £3 million will be required to report and pay the apprenticeship levy. This £3 million calculation includes connected companies and charities who have annual pay bills over this amount. If your pay bill, including connected companies and charities, is below £3 million you need take no action. Employers affected will be required to report and pay the amount due to HMRC through the normal payroll process. Your apprenticeship levy must be reported on the Employer Payment Summary (EPS) within 14 days after the end of each tax month i.e. no later than 19th of the following month. You should pay the levy at the same as you submit your usual PAYE payment and must continue to report this each month, even if your pay bill reduces and you are no longer required to pay. The axis payroll software has been updated to support reporting requirements for the levy.
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1.4 Scottish Rate of Income Tax (SRIT) |
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With effect from 6 April 2017, Scottish taxpayers will pay income tax using differing rates and thresholds to taxpayers elsewhere in the UK. Employers must ensure they apply the S codes received from HMRC to identify employees who are Scottish taxpayers. Scottish taxpayers will be identified via address information that is held by the HMRC; it is the employee’s responsibility to update HMRC with address changes to ensure the tax they pay is correct. If an employer is provided with a P45 with a Scottish tax code they will need to follow the current process when taking on a new employee. If a new starter does not provide a P45, or an employer is unsure what tax code to use, an employer can use the rest of the UK tax code and rate. HMRC will inform an employer if the tax code needs to be changed. Scottish rates do not need to be displayed separately on the P60 or payslips, but these documents should show the Scottish tax code. Further information is available on the Scottish Rate of Income Tax at https://www.gov.uk/scottish-rate-income-tax |
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1.5 Student Loan Deduction |
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From 6 April 2016 there were 2 student loan plan types which are known as Plan 1 and Plan 2. Each plan has a different threshold and you will need to deduct student loan repayments using the appropriate plan type. For the tax year beginning 6 April 2017, the thresholds will be £17,775 for Plan 1 (which includes your employees already repaying student loans), and £21,000 for Plan 2. How will I know which plan type to use? From March 2016 the SL1 start notice issued by HMRC shows which student loan plan type you should make deductions against for your employee. The starter declaration checklist prompts you to ask new employees about their student loan plan type. Form P45 will only indicate whether an employee is already repaying a student loan. It will not indicate a plan type and so you must ask the new employee for this information. If your employee does not know their plan type you should use Plan 1 by default and ask your employee to check their correct plan type with Student Loans Company. In some cases a plan type could change in a tax year. HMRC will notify you by sending a new SL1. When a new SL1 is received showing a different plan type you should simply amend the student loan deduction for the new plan type and deductions will continue uninterrupted. In these circumstances an SL2 Stop Notice will not be issued to you, only a new SL1. |
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1.6 Payrolling Benefits in Kind |
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From April 2016 the government introduced a voluntary framework to allow you to payroll most Benefits in Kind (BiKs). If you want to payroll your BiKs for the tax year beginning 6 April 2017, you must have registered using the online Payrolling Benefits in Kind (PBIK) service. One of the biggest benefits of payrolling in line with the framework is that you do not need to submit P11Ds for payrolled BiKs. Starting to Payroll – tax year beginning 6 April 2017 If you want to start payrolling you need to register with HMRC to let them know the BiKs you are going to payroll. axis payroll supports a “Benefit in Kind” pay component which will be included in taxable pay but excluded from amount paid. Further information on payrolling on BiK’s is available at https://www.gov.uk/guidance/paying-your-employees-expenses-and-benefits-through-your-payroll |
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1.7 Recording Employee Car Details |
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If you are registered for payrolling Benefits in Kind (BiKs), from 6th April 2017 you will have the option to report car information for the tax year 2017/2018. For tax year 2018/2019 this will become a requirement for those employers payrolling BiKs. axis payroll has been extended to allow recording of employee car details on the employee record and optionally submit this information in FPS submissions. |
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If you are an eligible employer the employment allowance is remaining at £3,000 a year from April 2017. If you aready claim the allowance and will continue to claim you will just need to continue to make the appropriate deductions from the amount of Class1 secondary National Insurance Contributions that you would have paid to HMRC.
If you have been eligible to claim the 'Employment Allowance' and have not yet submitted your claim for 2016-2017, you will need to go to 'Amend Employer Details' for the payroll data set through which you wish to claim the allowance and tick the 'Employment Allowance' option. Note: if you are operating more than one payroll data set, you should only claim through one data set.
Your final Calculate Monthly Remittance for the year will then include your claim for the allowance. You will then need to set 'Employment Allowance claim' to 'Yes' when submitting your final end of year EPS to advise HMRC that you are making the claim.
The information contained in this Payroll User Guide Supplement applies to axis payroll 2012, axis payroll 2014 and axis payroll 2016 users.
You do not need to install this update until you have completed the final period of the year, however it is safe to install the update at any time.
In order to allocate employees to the correct NI category, you must ensure that you hold the correct date of birth against each active employee record.
In order for HMRC to apply Scottish Rate of Income Tax (SRIT) correctly, it is important that employee addresses are kept up to date.
You are advised to read the February 2017 Issue of the Employer Bulletin which is available for download from the GOV.UK website.
Ensure you have ordered the required year end stationery.
Supplies are available free of charge from HM Revenue & Customs - please refer to the Employer Orderline
The available P60 stationery formats are:
NOTE. Since new copies of the stationery are issued every tax year, you should only order sufficient quantities to cover this year.
P45 forms for leavers are unchanged.
Supplies are available free of charge from HM Revenue & Customs Employer Orderline
The supported formats are:
If you pay your employees weekly, fortnightly or four-weekly, this tax year will include a week 53 payment for wages paid on 5th April 2017.
The update must be installed on your axis payroll software server. This will usually be your network server, but a number of axis payroll users run their payrolls on a stand-alone PC.
Customers using axis payroll will download the update from our website.
To download the update:
Follow the Installation Procedure detailed below.
Please note that you need only install this update once for all axis Payrolls providing that all payrolls reside on the same machine. Where payrolls are 'switched' between 'home' and 'office', then each such machine requires the update.
Ensure that a full backup of the system is taken. Use the 'Copy Data to Full Backup' function to create an archive backup of the payroll data on to removable media. We also strongly recommend that a full backup of the axis programs and data is made.
You should run the installation procedure from the axis payroll server.
- You should be logged onto the axis payroll server. Elevation will be required.
- Ensure that all axis users are out of the system. You can do this by clicking on the System Console/User Status Enquiry button, found on the axis payroll Scheduler toolbar. Then come out of the system yourself
- If installing a downloaded version of the software, the file needs to be on the axis server and so may need to be copied to the server either directly over the network or via a form of removable media if it has been downloaded on another workstation. The executable can then be run to install the update files.
- If installing from an update USB memory device or update DVD, insert the update device/DVD into the server. The device/DVD should auto-run. If it does not, please call for assistance
- Click on Install/Upgrade axis diplomat (2012, 2014 or 2016) System.
- Click Upgrade Existing System.
- If you are continuing to use axis payroll 2012 or axis payroll 2014, an information screen will appear:
Confirm that you wish to continue- Confirm that you accept the terms of the license agreement:
- Select the drive that contains your axis payroll system. This will normally be the default drive presented:
- The installation procedure will now check that there are still no users in the system, check for sufficient disk space and then ask you to confirm that you wish to update the axis diplomat Software.
- The installation procedure will continue and update the axis payroll software.
- Once the installation has completed, you will receive a ‘Setup Completed Successfully’ message, click ‘OK’ and then ‘Cancel’ out of the menus.
- Finally, whilst you are still logged on to the axis server, you should enter each of your axis payroll systems in turn and perform any updates requested.
- This completes the installation procedure. Once the installation has completed, you will receive a ‘Setup Completed Successfully’ message, click ‘OK’ and then ‘Cancel’ out of the menus.
Ensure that you have installed your axis payroll Legislation Update before proceeding with the year end procedures. Please ensure that a FULL security backup is taken of the payroll data BEFORE installing the axis payroll Legislation Update and again before running the last function ‘Year End Processing’.
You also need to ensure that you have:
Please note: HMRC accept the 'final submission for the year flag' in either the last submitted FPS file for the year or in the final EPS file. axis payroll only supports submission of this flag in the EPS and the file is automatically flagged in the background as the final submission for the year. The 'end of year questions and declaration' are also no longer required and so have been removed from the summary. Refer to http://www.gov.uk/payroll-annual-reporting/send-your-final-payroll-report for further information.
The system will produce a 132 column plain paper report detailing the total amounts accumulated for each pay/deduction component, total PAYE and total NIC. Please read the associated help documentation for further details.
The system will produce a 132 column plain paper report (based on the NIC section of a P11) detailing N.I. Liable Earnings and N.I. Contributions for each employee on a period by period basis for the frequency selected.
We would advise that the report is kept for a minimum of 3 years, in case of query from HM Revenue & Customs.
Please read the associated help documentation for further details.
The system will produce a 132 column plain paper report (based on the PAYE section of a P11) detailing Taxable Earnings and Tax Paid for each employee on a period by period basis for the frequency selected.
We would advise that the report is kept for a minimum of 3 years, in case of query from HM Revenue & Customs.
Please read the associated help documentation for further details.
The system will produce a 132 column plain paper report with one page per employee showing each day of sickness absence, maternity leave, etc, taken during the year. Both April 2013 and April 2014 are printed for information.
Please read the associated help documentation for further details.
The system will produce an 80 column employee listing of NIC and tax deductions followed by a summary of payments for the year.
We would advise that a copy of the report is kept on file for a minimum of 3 years in case of query from HM Revenue & Customs.
Please read the associated help documentation for further details.
A P60 must be printed and given to each employee still employed on 5th April.
Please refer to the Introduction of this supplement for further information on how to order stationery and which formats are available.
The documents are printed in surname order.
Please read the associated help documentation for further details.
You must ensure that you have successfully submitted an RTI Employer Payment Submission file if this is your only payroll frequency and payroll data set for the employer PAYE reference or is the payroll frequency/payroll data set from which you have chosen to submit combined figures before proceeding to use the Year End Processing function. You will need to submit a final year end EPS even if you have no statutory payments to recover in order to advise HMRC that you are making the final submission for the year.
Please note: HMRC accept the 'final submission for the year flag' in either the last submitted FPS file for the year or in the final EPS file. axis payroll only supports submission of this flag in the EPS and the file is automatically flagged in the background as the final submission for the year. The 'end of year questions and declaration' are also no longer required and so have been removed from the summary. Refer to http://www.gov.uk/payroll-annual-reporting/send-your-final-payroll-report for further information.
You should now take a Year End Security Copy of all axis payroll Data using the 'Copy Data to Full Backup' function and selecting the "Retain backup indefinitely" and "Archive backup" options.
We would advise you to keep the backup archive for a minimum of 3 years in case of query from HM Revenue & Customs.
This is also important in case there is a problem with your end of year returns.
The system asks for confirmation that a security back up has been taken and asks you to confirm that you have read and understood this guide before proceeding.
The process then clears all accumulators to zero for the new tax year.
The previous years’ details are retained in the Payroll Payment Archive File.
The increase of 50 will be automatically applied to L suffix tax codes for all active employees, e.g. 1100L will be amended to 1150L.
The corresponding increase of 55 and 45 will be applied to M and N suffix tax codes.
Re-enter your payroll system.
The Employment Allowance remains at £3000 per year from 6th April 2017.
If you were eligible for and claimed Employment Allowance for the tax year ending 5th April 2017 no action is required to claim from 6th April 2017.
If you have become newly eligible to claim the 'Employment Allowance' you will need to go to 'Amend Employer Details' for the payroll data set through which you wish to claim the allowance and tick the 'Employment Allowance' option. Note: if you are operating more than one payroll data set, you should only claim through one data set. Calculate Monthly Remittance will then include your claim for the allowance. You will need to create and submit an RTI Employer Payment Summary in the first month of the tax year to advise HMRC that you are claiming the allowance setting the 'Employment Allowance claim' option to 'Yes'.
The standard personal allowance increases from £11000 to £11500.
The code for emergency use with effect from 6th April 2017 changes accordingly to 1150L
There is a general uplift of L suffix tax codes by 50 and a corresponding uplift to M and N suffix tax codes by 55 and 45 respectively. The increment is applied automatically to all existing employees by the 'Year End Processing' routine.
Where you receive a code notification for an individual employee to be operated from 6th April 2017 (on Form P9(T) or via your online HMRC account), the specified code must be entered after the year end has been run.
Refer to form P9X(2017) for further details.
Calculate Net Pay will check the tax year / pay date and automatically apply the following Class 1 earnings thresholds effective from 6th April 2017:
| Weekly | Monthly | Yearly | |
| Lower Earnings Limit | £113.00 | £490.00 | £5,876.00 |
| Primary Threshold | £157.00 | £680.00 | £8,164.00 |
| Secondary Threshold | £157.00 | £680.00 | £8,164.00 |
| Upper Secondary Threshold (Under 21) (UST) | £866.00 | £3,750.00 | £45,000.00 |
| Apprentice Upper Secondary Threshold (Apprentice Under 25) (AUST) | £866.00 | £3,750.00 | £45,000.00 |
| Upper Earnings Limit | £866.00 | £3,750.00 | £45,000.00 |
The Employee and Employer NI contribution rates for NIC categories A, B, C, H, J, M and Z remain unchanged.
Calculate Gross Pay will continue to check employees in the 'under 21' and 'under 25' N.I. categories and amend their category to a standard category if that employee has achieved the age of 21 or 25 by the pay date of the period being run.
Note: The 'Print Payroll Parameters' function, accessed from the 'Supervisor Functions' menu, may be used to produce a report of the rates applicable to each NI category and band of earnings.
The weekly rate has increased to £89.35.
The appropriate daily rate is determined by the number of qualifying days.
Eg. The daily rate for an employee with five qualifying days is £17.87.
Statutory Maternity Pay (SMP) is paid at 90% of the employee's average weekly earnings for the first six weeks. The standard weekly rate for the remaining weeks is £140.98 or 90% of the employee's average weekly earnings, whichever is lower.
Statutory Adoption Pay (SAP) is paid at 90% of the employee's average weekly earnings for the first six weeks. The standard weekly rate for the remaining weeks is £140.98 or 90% of the employee's average weekly earnings, whichever is lower.
Statutory Paternity Pay (SPP) is payable for 1 or 2 weeks at the standard weekly rate of £140.98 or 90% of the employee's average weekly earnings, whichever is lower.
Statutory Shared Parental Pay (ShPP) is payable at the standard weekly rate of £140.98 or 90% of the employee's average weekly earnings, whichever is lower. Information for employers is available at http://www.gov.uk/shared-parental-leave-and-pay-employer-guide/entitlement
The amount of SMP/SPP/ShPP/SAP that may be recovered for employers who do not qualify for Small Employers Relief (SER) is 92% of the SMP/SPP/ShPP/SAP paid to their employees.
Employers who do qualify for Small Employers Relief (SER) can recover 100% of the SMP/SPP/ShPP/SAP paid to their employees plus NIC compensation of 3%.
A ‘small employer’ is one who paid (or was liable to pay) total gross class 1 NICs of £45,000 or less in the individuals qualifying tax year.
The annual threshold for the collection of existing Plan 1 Student Loans increases from £17,495 to £17,775.
The annual threshold for the collection of Plan 2 Student Loans is £21,000.
The deduction percentage rate remains unchanged at 9% of earnings above the threshold.
Calculate Net Pay will automatically apply the appropriate annual tax bands for the tax year / pay date as follows:
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2016 - 2017 |
2017 - 2018 |
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| UK Basic Rate | 20% | £1 to £32,000 | £1 to £33,500 |
| UK Higher Rate | 40% | £32,001 to £150,000 | £33,501 to £150,000 |
| UK Additional Rate | 45% | £150,001 and above | £150,001 and above |
| Scottish Basic Rate | 20% | N/A | £1 to £31,500 |
| Scottish Higher Rate | 40% | N/A | £31,501 to £150,000 |
| Scottish Additional Rate | 45% | N/A | £150,001 and above |
The new bands for 2017-18 are effective from the first pay day on or after 6th April 2017.
NB. A report of all the current statutory deduction and payment rates can be produced using the ‘Print Payroll Parameters’ function which is located on the Supervisor Functions menu.
As the qualifying earnings are reviewed annually, please contact your pension scheme provider to see if there are any changes.
If so, this can be changed in Amend Pension Scheme Details.