Beware of Annual Payroll Issues

Beware of Annual Payroll Issues

There has been a recent worrying development regarding end of year annual payments.

It is common practice amongst small owner managed Companies for the Directors to pay themselves an annual salary at the end of the tax year to simplify payroll issues.

We understand that HMRC are currently rejecting furlough claims in respect of these payments. Their rationale is that any furlough claim must relate to an employee (which includes directors) to whom the employer has made a payment of earnings BEFORE 19 March 2020, and that a payroll RTI report must have been made by the same date.

Clearly this is unfair and representations have been made to HMRC so this position may change. However, as matters stand, annual schemes will miss the target date for a furlough grant.

We will continue to monitor this situation closely and provide updates as they happen. In the meantime, Please call us for specific advice on your circumstances – 01633 810 081 or email us at info@kilsbywilliams.com