As we near the end of the year, it is time to take stock and look ahead to the changes announced in the Budget at the end of last month, due to come into effect from April 2019.

National Minimum Wage and National Living Wage

With effect from April 2019, the current National Minimum Wage hourly rates will increase to the following:

Apprentices: £3.90
16-17 year olds: £4.35
18-20 year olds: £6.15
21-24 year olds: £7.70

The National Living Wage will increase to £8.21 an hour.

Apprenticeship Levy

With effect from April 2019, businesses which pay the apprenticeship levy will be able to direct up to 25% of the levy back into the costs of training for apprentices in their supply chains. Smaller businesses will contribute less towards the cost of training apprentices, paying 5% towards these costs with the remainder being met by the government (the previous contribution rate was 10%).

From IR35 to the off-payroll rules

The government also confirmed that, with effect from April 2020, private sector companies which engage contractors through personal service companies will be responsible for deducting income tax and National Insurance from their fees at source, to the extent that those contractors have the legal status of employees for tax purposes. Public sector entities have been subject to these requirements since last year. This change will only apply to larger companies, not affecting the smallest 1.5 million businesses in the UK.

Sinead Noonan has blogged in more detail about the detail of the rollout of the off-payroll rules to the private sector – read her post here.

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