Here is a quick overview of what changes you need to consider for the 2019/20 tax year, broken down into two categories; new legislation and updated legislation.

New Legislation

Welsh Tax Code Changes
Post Graduate Loans
Payslip Changes

Updated Legislation

Rates and threshold changes for PAYE, National Insurance, Student Loans
New ‘standard’ tax code for tax year of 1250L
Statutory pay increases
National Minimum Wage increases
Updated Starter Checklist to cover Post Graduate Loans

Welsh Tax Code Changes

From April 2019, Wales can set their own tax rates (above the 10p per £1 pre-set limit) for anyone identified as a Welsh Tax Payer.

For 2019/20, Welsh Tax (or WRIT) will follow the same rates and bands as the rest of the UK although you can identify a Welsh Tax Payer by the ‘C’ pre-fix on their tax code.

So, are you responsible for identifying a Welsh Tax Payer? No, the HMRC will use addresses that they hold on their database to identify Welsh Tax Payers. It is an employee’s responsibility to ensure that their address is correct with the HMRC.

Post Graduate Loans

A third type of student loan deduction is coming in to effect from April 2019 in addition to Plan 1 and Plan 2.

Post Graduate loans are set to be deducted at a rate of 6% on earnings over £1750.00 per month.

If your new employee tells you via their P45 or starter checklist that they have a student loan, you will need to ask them what Plan Type their loan is and record this in the Payfit system.

If you or your employee are unsure of what Plan Type to use, use Plan 1 and the HMRC will send you a Student Loan notice following your FPS submission with the correct plan to use.

Payslip Changes

The Employment Rights Act 1996 has now broadened the items required to be shown on a payslip. If your employee is paid hourly, or receives an element of their pay that is paid using an hourly rate such as overtime, then the number of hours paid must be shown on the payslip.

Hours relating to absence do not need to be included.

2019/20 Rates and Thresholds

Tax

Rest of UK and Wales Tax:

Threshold* 2018/19	Threshold* 2019/20	Tax Rate
Up to £34,500	Up to £37,500	20%
£34,501 to £150,000	£37,501 to £150,000	40%
Above £150,000	Above £150,000	45%

*After personal allowance has been applied

Scottish:

Threshold* 2018/19	Threshold* 2019/20	Tax Rate
Up to £2,000	Up to £2,049	19%
£2,001 to £12,150	£2,050 to £12,444	20%
£12,151 to £31,580	£12,445 to £30,930	21%
£31,581 to £150,000	£30,931 to £150,000	41%
Above £150,000	Above £150,000	46%

*After personal allowance has been applied

Standard Tax Code

The standard tax code for 2019/20 is 1250L.

This has changed from 1185L.

National Insurance – Employee Rates

Category Letter	Earnings up to PT	Earnings between PT & UEL	Earnings above UEL
2018/19	Up to £702 per month	£702 to £3863 per month	Above £3863
2019/20	Up to £719 per month	£719 to £4167 per month	Above £4167 per month
A	0%	12%	2%
B	0%	5.85%	2%
C	nil	nil	nil
H (Apprentice under 25)	0%	12%	2%
J	0%	2%	2%
M (under 21)	0%	12%	2%
Z (under 21 - deferment)	0%	2%	2%

National Insurance – Employer Rates

Category Letter	Earnings up to PT	Earnings between PT & UEL	Earnings above UEL
2018/19	Up to £702 per month	£702 to £3863	Above £3863
2019/20	Up to £719 per month	£719 to £4167	Above £4167
A	0%	13.8%	13.8%
B	0%	13.8%	13.8%
C	nil	13.8%	13.8%
H (Apprentice under 25)	0%	13.8%	13.8%
J	0%	13.8%	13.8%
M (under 21)	0%	13.8%	13.8%
Z (under 21 - deferment)	0%	13.8%	13.8%

Statutory Pay

Statutory Sick Pay increasing to £94.25, from £92.05 in 2018/19.

Statutory Maternity/ Paternity/ Adoption/ Shared Parental Pay increasing to £148.68, from £145.18 in 2018/29

(SMP and SAP are still payable at a rate of 90% earnings for the first 6 weeks)

National Minimum Wage and National Living Wage

Year	25 and over*	21 to 24	18 to 20	Under 18
April 2018	£7.83	£7.38	£5.90	£4.20
April 2019	£8.21	£7.70	£6.15	£4.35

*Also National Living Wage Rate

Student Loan Recovery

	Plan 1	Plan 2	Post Graduate
	9% on earnings over	9% on earnings over	6% on earnings over
2018/19	£1,527.50 per month	£2,083.33 per month	N/A
2019/20	£1577.91 per month	£2143.75 per month	£1750.00 per month

End of tax year

End of tax year information