The following Employment Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:
National insurance contributions are due on a person’s earnings from employment, provided that person is not outside the scope of national insurance which may be due to their age or residence status (see the Overview of NIC Classes, rates and thresholds guidance note).
The usual class of NICs that applies to earnings from an employment is Class 1, which has both an employee and an employer contribution. These are collected throughout the year under the PAYE system (see the Monthly compliance guidance note).
Earnings are defined for the purposes of national insurance as including 'any remuneration or profit derived from an employment (SSCBA 1992, s 3(1)) and for all intents and purposes can be taken as having the same meaning as earnings for the purposes of tax, as defined in ITEPA 2003, s 62. See the Taxation of cash earnings guidance note. The interpretation of the definition of earnings for tax purposes from various court cases also applies to the definition of earnings for NIC purposes. See NIM02010.
For the most part, earnings chargeable to tax under ITEPA 2003, s 62 are cash earnings, but there are two main categories of non-cash benefit that are taxable under that section: one is benefits that have ‘money’s wor
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The basic rule is that all benefits provided to an employee by reason of their employment are taxable unless there is a specific exemption or other rule that means they are not chargeable to tax.ExemptionsThe main exemptions for employee benefits are in ITEPA 2003, ss 227–326B (Pt 4).Below is an
The rent-a-room scheme was introduced in the early 1990s to encourage homeowners to take in lodgers.Fundamentally, the rent-a-room scheme is a relief which means that the rent received by an individual from a lodger (up to a prescribed limit) can be exempt from income tax. If the gross rents are
This guidance note considers the capital gains tax implications where shares are sold in exchange for new shares.The consideration paid by a purchasing company to the shareholder(s) for their shares in a target company could be in the form of either:•new shares in the vendor in exchange for shares
This guidance note provides an overview of what conditions need to be met before a business is entitled to treat VAT incurred as input tax. This note should be read in conjunction with the other notes in the ‘Claiming input tax’ subtopic. For a flowchart outlining the procedure for claiming input
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