Changes for the Companies Act, National Insurance and Changes for Charities Act 2006

Please contact us to discuss any of the matters raised in this newsletter

And finally...;

Some of your employees will face big increases in their NI liability in April 2008 and April 2009. In Gordon Brown's final Budget he stated that the Upper Earnings Limit (UEL) would increase ahead of inflation in both years, so that by 2009 it will be in the region of £43,000 per annum - nearly £830 per week. The reason given for this increase is the 'harmonisation' with the point at which the higher rate of 40% income tax will apply.

Unfortunately income tax and NI harmonisation will not be simple as many staff earning above the current UEL of £670 per week will have a car, medical insurance or other benefits in kind. These benefits in kind will be included in their tax codes for income tax purposes and effectively reduce the availability of their personal allowances and basic rate bands. Their 40% income tax liability, on their pay, will therefore commence at a lower level than the point at which their NI rate will fall from 11% (if not contracted-out) to 1%. This means that they will effectively pay a marginal rate of 51% on some of their pay.

We find that many businesses and individuals struggle to a greater degree with NI issues than with tax. If we can help you regarding any of the subjects covered in this bulletin or if you need any further information on any of these matters please get in touch.

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National Insurance Special

Companies Act Special

Changes for Charities Special

Changes for the Companies Act, National Insurance and Changes for Charities Act 2006

And finally...;