Round-up of tax and legislation changes coming in from 6 April

A number of tax and legislation changes that come into effect from 6 April 2013 will have an impact on employee benefits.

  • Real-time information (RTI) reporting begins.

From 6 April, employers will have to start reporting pay-as-you-earn (PAYE) information to HM Revenue and Customs (HMRC) in real time. Employers with fewer than 50 employees will have until 5 October to comply.

  • Personal tax allowance rise.

The personal tax allowance will rise to £9,440 on April 6, following Chancellor George Osborne’s announcement in the 2012 Autumn Statement.

  • Reduction in higher-rate income tax.

The additional rate of income tax for individuals with adjusted net incomes over £150,000 will be reduced from 50% to 45% from 6 April. See Employers make bonus choices as tax rate changes.

David Truman, partner at Menzies, said: “Planning in advance by deferring income from the current tax year to the next, and advancing expenditure or deductions into the current tax year can substantially improve your tax position.”

  • Increase in Statutory Sick Pay (SSP).

SSP will rise from £85.85 to £86.70 a week on 6 April.

Ian Smart, head of product development and technical support at Bright Grey, said: “Experiencing an illness or accident that is severe enough to prevent you working for a prolonged period is worrying in itself, without the financial implications of losing out on a regular income. 

“As such, the increase to the standard rate of SSP is to be welcomed.”

  • Expat tax test.

A new statutory test to determine whether individuals are resident in the UK for tax purposes comes into effect on 6 April.

The new statutory residence test (SRT) aims to remove any grey areas when determining an individual’s residence status for UK tax purposes.

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Davyd Fisher, a specialist in expatriate tax at Grant Thornton UK, said: “For employees working full-time abroad, there’s now a defined amount of time people can spend working in the UK before they become resident for tax purposes, with the threshold set at 30 work days.”