Three ways to keep up with payroll legislation
Keeping your operations compliant with changing payroll legislation is essential. Not doing so will incur hefty fines from HMRC and frustrate any employees whose pay is incorrect. Plus, if you fail to meet critical regulations like National Minimum Wage, your business’s reputation will be on the line.
The problem is the ever-changing nature of legislation. It’s an ongoing endeavour and requires special attention. You’ll have heard of GDPR, auto-enrolment, and the National Living Wage, but each year brings new changes to the way employees are paid. For example, upcoming IR35 legislation is set to severely impact some contractors in April 2021.
Whether you’re an accountant or operating in-house payroll, continue reading for ways you can keep up with payroll legislation to stay compliant.
1. Payroll software
Any concerns around legislation can be addressed with great payroll software. A reputable software vendor should be up to date with HMRC requirements and their development team should be available to implement planned changes.
Sometimes legislation can be quick and unexpected, for example, the Job Retention Scheme (JRS) was introduced as a response to COVID-19. You should have the reassurance that your payroll software will meet requirements as and when needed. At Codapay, we implemented functionality that allowed our clients to pay furloughed workers correctly and rolled it out automatically across the cloud platform.
Cloud vs on-premises software is an important consideration for compliance. You’ll always be running the latest updates on cloud software, whereas this will need to be installed if you’re using an on-premises solution, which can often require an additional cost to receive the update. There’s also the consideration of GDPR when it comes to holding your employees’ information.
If you’re unsure whether your payroll product is up to date with regulations, get in touch with your support team. A good software provider will also communicate any version updates impacting compliance.
2. Events and training
There are plenty of industry events out there to keep you in the loop of changes and the best way to address these. Even if you don’t pick up any new information, you can leave reassured your processes are compliant by speaking with other payroll professionals.
Key events to attend are listed by The Chartered Institute of Payroll Professionals (CIPP). However, you’ll be able to find plenty of B2B courses and seminars online to cover key changes to legislation. These sessions can be valuable for ensuring your payroll team members are on the same page and helping to reinforce the importance of compliance.
3. Online resources and alerts
The quickest and easiest way to stay compliant is to be connected.
The most reliable sources of information include CIPP and HMRC, so it’s worth dedicating time to check new articles on their sites. HMRC also offers the option to sign up for email updates that outline any changes and important reminders. Businesses within the industry also blog about major legislation, so there are plenty of resources to use.
Social media is a great way to be notified of any upcoming changes. Payroll experts will share any key news and start conversations where you can get involved. Twitter is the best platform to use for this, as you’ll be able to view relevant hashtags like #payroll and #tax. By creating a Twitter list, you can compile a list of relevant users to refer to.
Media outlets will report on the most impactful changes to legislation. A date you must keep in your diary is the annual Budget, where the Chancellor of the Exchequer will outline key changes to taxes for the tax year ahead.
We work with payroll experts to ensure our solutions are compliant. Stay updated on our blog which we update with all the latest tax and payroll news.