Common Issues
- Employees on Benefit
When you know that a potential employee is on benefit, please ensure that the appropriate Benefits Office has been informed that you wish to employ them. As a minimum, you should always ask for evidence of their National Insurance Number.
- Employees who do not have a National Insurance Number
Keep a record of their full name (surname and first names), address, date of birth and sex and ask them to contact their nearest Jobcentre Plus office to obtain a National Insurance Number.
- Employees who hold other employments
Determine if NIC is payable based on their age and the earnings agreed with them. Obtain a P46 Revenue form for the employee to complete Section 1. This would help you to determine the appropriate tax code to use for the Income Tax computation.
- Self employed workers
Ask for a copy of a letter from the Inland Revenue confirming their self-employment tax status for your files. No deductions for Tax or NIC will need to be made, once this confirmation letter has been received. If an employer is in doubt regarding the status of the worker, it is advisable to deduct Tax and NICs via the normal PAYE procedures.
- Remunerating the church organist
Payment is normally irregular depending on the number and frequency of services taken. Whether or not NIC and/or income tax is payable will depend on the age of the organist, the period covered by each payment and their earnings from other sources. First, establish the full facts of each case and consult your local tax office, for advice, if required.
- Paying travel expenses of employees and other office holders
Reimbursing employee expenses of travel between home and the place of work would give rise to liability to tax. However, for other office holders working on a voluntary basis for the LRC, where similar payments are made, no tax charge will arise.
- Provision of accommodation
Legal advice should be sought on residency arrangements to ensure the appropriate type of agreement is set up.