As from April 2019, there are some changes taking place that are worth you knowing that could make a financial difference to you and your bank balance; not necessarily in a bad way either! In a nutshell, here is what’s changing:
National Minimum Wage is increasing – Both the National Living Wage (NLW) and National Minimum Wage (NMW) rates will increase in April 2019. The “living wage”, the effective minimum wage for people aged 25 or over, will rise from £7.83 per hour to £8.21 per hour. For those 21 to 24, it will go up from £7.38 per hour to £7.70 per hour.
State pensions – State pension rates are set for huge changes from April 6 after the current tax year comes to an end. The boost will see those receiving the basic state pension getting an extra £3.25 a week, increasing the state pension from £125.95 to £129.20. Retired workers in this group will then have £169 more for the year, which works out as an annual income of £6,718.40.
Work pensions – The minimum contributions for auto-enrolment pension schemes will increase for employers and employees. Existing rules mean employers must contribute a minimum of 2% of a worker’s pre-tax salary, with the worker contributing 3%. Under the new rules, employers and employees will now have to contribute a minimum of 3% and 5% respectively.
Income tax – The income tax threshold will increase to £12,500. This means that you won’t pay any income tax at all until you earn a certain amount. If you have an annual income of at least £12,500, you’ll probably pay £130 less tax a year. The threshold for the higher rate of income tax – the 40% rate – will increase to £50,000-a-year. It means that some people on higher salaries – more than £46,351-a-year – will also gain another £730 in their pay packets.
Payslips – From April 6 the legal right to a payslip will be extended to include non-employees such as contractors and freelancers. Employers will also be obliged to include the total number of hours worked on payslips for employees whose wages vary depending on how much time they have worked.
Business VAT rules – A of April, all VAT-registered businesses with taxable turnover above the VAT registration threshold will have to keep VAT records in digital form and file their VAT returns using software.
Statutory Sick Pay – The qualifying criteria for statutory sick pay (SSP) will change from April 6 as well as the amount of money staff will be entitled to earn each week. This means individuals will need to earn at least £118 per week in order to qualify for weekly payments of £94.25. Similarly, the rate of pay for maternity, paternity, adoption and shared parental pay will increase to £148.68 per week from the April 7.
Pay gap reporting – Private organisations with 250 or more employees will again be required to publish their gender pay gap figures on April 4. New legislation will come into force that requires companies with more than 250 employees to publish their executive pay gap.
Tribunal pay-outs – The amount of money employees could be due for a successful tribunal claim will also increase from April 6, 2019. From this date, successful claims for unfair dismissal could result in a maximum compensation payout of £102,194.
So, not all bad for a change and some positive changes to help ease financial burdens and constraints.