11th April 2024
As we step into the new financial year of 2024/2025, it is vital that businesses are aware of the key updates and changes to ensure smooth sailing through the payroll landscape. We’ve highlighted some of the crucial change’s businesses should be aware of when processing April payrolls:
National Minimum Wage And National Living Wage Adjustments
As traditional with the start of each new financial year, changes to the National Minimum Wage (NMW) and the National Living Wage (NLW) have been implemented. These changes are crucial for businesses to adhere to, ensuring compliance with employment laws and fair treatment of employees.
For 2024/2025, the government has announced adjustments to these rates, reflecting the ongoing efforts to address issues of living standards and income inequality. Employers must ensure they are paying their employees the correct minimum wage rates, which are determined by age and whether the employee is an apprentice. Please be aware that the age threshold for National Living Wage has been reduced from 23 years of age to 21 years of age.
| Workers aged 21 & over | £11.40 |
| Workers aged 18 & over | £8.60 |
| Workers 16 -17 inclusive | £6.40 |
| Apprentices under 19 | £6.40 |
| Apprentice in their first year | £6.40 |
Changes To Statutory Payments
Statutory payments such as Statutory Sick Pay (SSP), Statutory Maternity Pay (SMP), Statutory Paternity Pay (SPP), Statutory Adoption Pay (SAP), Statutory Shared Parental Pay (ShPP) and Statutory Parental Bereavement Pay (SPBP) undergo adjustments in the new financial year.
It’s essential for employers to stay informed about these changes to fulfil their obligations to employees and avoid any potential legal ramifications. Keeping up with adjustments ensures that employees receive the entitlements they are due during life events such as illness, childbirth, or adoption.
| Statutory Sick Pay | £116.75 |
| Statutory Maternity Pay (SMP), Statutory Paternity Pay (SPP), Statutory Adoption Pay (SAP), Shared Parental Pay (ShPP) & Statutory Parental Berevavemnt Pay (SPBP) | £184.30 |
Student Loan
Plan 1, Plan 2 and Plan 4 loan thresholds have been subject to adjustments, whilst Postgraduate Loan remains the same. These changes affect the amount that borrowers must earn before they start repaying their loans.
| Threshold Plan 1 | £22,015 per annum |
| Threshold Plan 2 | £27,295 per annum |
| Threshold Plan 4 | £27,660 per annum |
| Postgraduate Loan | £21,000 per annum |
Change to NI Rates for 2024/2025
In January 2024, the Government changed the employee national insurance rate to 10% from 12%. In the Spring 2024 Budget, further adjustments were announced reducing the employee national insurance rate by a further 2% to 8%. These changes are part of the government’s efforts to ensure the sustainability of the welfare system while balancing the needs of individuals and businesses.
Software Updates and Compliance
With the evolving landscape of payroll regulations, it’s essential for businesses to ensure that their payroll software is up to date. Updated software not only helps in incorporating the latest legislative changes but also enhances efficiency and accuracy in payroll processing.
Furthermore, compliance with data protection regulations such as GDPR (General Data Protection Regulation) remains paramount. Businesses must handle payroll data securely and responsibly to safeguard sensitive employee information.
Navigating payroll updates requires diligence and proactive measures. Staying informed about changes to minimum wage rates, statutory payments, pension contributions, tax codes, and maintaining compliant payroll software are vital steps towards ensuring smooth payroll operations and fostering a positive employer-employee relationship. If you have any queries, please contact the payroll team on 01903 300230 who will be more than happy to assist.