From 1st October 2011

The government has announced that the National Minimum Wage rates will increase as follows:

• the adult rate will rise by 15p to £6.08 per hour
• the rate for 18 – 20 year olds will rise by 6p to £4.98 per hour
• the rate for 16 – 17 year olds will rise by 4p to £3.68 per hour
• the apprentices’ rate will rise by 10p to £2.60 per hour

Agency Workers Regulations 2010.

Temporary agency workers will be entitled to equal treatment with comparable permanent employees after 12 calendar weeks in the same job, but this will not apply to occupational pension schemes or occupational sick pay.

Changes to Vat from 1st  January 2012 – Childcare vouchers management fees…

On 28th July, new guidance around VAT and childcare vouchers was released by the Government. The guidance highlighted that from 1st January 2012, companies can no longer recover the VAT paid on the management fees charged by childcare voucher providers.

However, as childcare vouchers are exempt from tax and National Insurance, this change has a minimal impact on the overall value and success of your scheme.

To explain how this works in practise, if you had 5 employees taking £200 a month then the total face value of the vouchers is £1000. From this, your management fee invoice could be £60. If you then pay 20% VAT on top of this the total is £72. Your scheme is therefore costing you £72 but you are actually saving £138 in employer NI each month.   

In total your scheme would be saving you £66 a month, or £792 a year.