Key items on the agenda for businesses in April include the start of the first reporting periods for large companies on payment practices and performance, the countdown to go-live for the Small Business Commissioner’s complaints function and data gathering in anticipation of the first gender pay gap reports.
April is typically a busy month for employment and tax developments, and this year is no different with, among other things, the introduction of the apprenticeship levy.
Six-monthly reporting on payment practices and performance begins
The duty on large companies and LLPs to report on their payment practices and policies in relation to certain contracts applies for financial years beginning on or after 6 April 2017. Organisations that are subject to the reporting duty will need to have systems in place to enable them to track their practices and report on them in time to publish their first report.
Reporting periods are six-monthly, which may take some getting used to. In practice, an organisation’s first reports could be due on or before 4 November 2017, depending when its financial year begins.
Suppliers can complain about payment issues to Small Business Commissioner
The Small Business Commissioner’s complaints handling function for small businesses who are experiencing payment issues in connection with the supply of goods or services to a larger business will go live on 1 October 2017.
Although the go-live date for the scheme is still some way off, small suppliers will be able to complain about payment issues arising from April 2017. Larger businesses will need to work out whether the scheme affects them and put in place processes that enable them to respond to complaints effectively and make representations where relevant.
Gender pay gap reporting data capture begins
Private and voluntary sector employers with 250 or more employees will need to start capturing pay data as at 5 April 2017 so that they can make their first gender pay gap reports next year.
McGregor-Smith Review on race in the workplace
An independent review has urged businesses to drive forward the agenda for improved diversity and inclusion in the workplace. Its key recommendations are that businesses with more than 50 employees should publish “aspirational targets” to increase diversity and inclusion throughout their organisations, with a board-level sponsor, and that they should be required by law to publish a breakdown of their workforce by race and pay band.
Annual whistleblowing reporting to begin for prescribed persons
The requirement for prescribed persons to report annually on disclosures of information received from workers is due to come into force on 1 April 2017. The relevant regulations have been published in draft form. The reporting period will be 12 months beginning on 1 April each year. Details of how the report should be published and what it should contain are contained in the draft regulations.
Salary sacrifice restricted on certain benefits in kind
Benefits in kind provided through salary sacrifice (other than excluded benefits and intangible benefits, such as holidays) will become chargeable to income tax and employers’ NICs with effect from 6 April 2017.
Apprenticeship levy comes into effect
The apprenticeship levy comes into force from 6 April 2017. The levy will require all UK employers in both the private and public sectors, which have annual wage bills of more than £3 million, to pay 0.5% of their annual wage bill towards the cost of apprenticeship training. This replaces the current system, enabling employers to choose and pay for the apprenticeship training they want.
National living wage increases
The national living wage for workers aged 25 and over will increase by 30p to £7.50 an hour on 1 April. The rates of other minimum wage bands will also increase.
New immigration skills charge for sponsors
A new immigration charge of £1,000 a year for larger sponsors (lower for smaller sponsors and charities) is expected to be introduced in respect of certain skilled migrants they sponsor in Tier 1 and Tier 2 from 6 April 2017.
New insolvency rules come into force
The new insolvency rules, which are intended to be more user-friendly and make the procedures cheaper, faster and more environmentally friendly, come into force on 6 April 2017.
Restriction on corporation tax loss carry forwards applies
A company that incurs losses on or after 1 April 2017 will be able to carry forward those losses and set them against profits of different activities, or against the profits of another company within the same group. However, the amount of a company’s or group’s profit that can be relieved by those carried forward losses will be restricted to 50%. The restriction will only apply to companies or groups carrying forward more than £5 million of losses in an accounting period.
Corporate governance reform agenda continues
The Business, Energy and Industrial Strategy (BEIS) Committee is continuing its investigation into corporate governance reform. Practical Law has published a toolkit highlighting the progress on the reforms in that inquiry, the BEIS Corporate Governance Reform: Green Paper and the FRC proposal for a fundamental review of the UK Corporate Governance Code.
ICO gives insight into future initiatives planned
The recent ICO Data Protection Practitioners’ Conference highlighted several initiatives that the Information Commissioner’s Office (ICO) will be taking in the coming months, including publishing guidance on Data Protection Officers, which will be of interest to organisations looking to appoint a DPO as part of their accountability programme for GDPR compliance.
Changes to cost-sharing arrangement definition in patent box rules take effect
Provisions concerning cost-sharing arrangements will be introduced into the patent box rules by the Finance Bill 2017 and to take effect from 1 April 2017. Draft legislation published last year will be amended to narrow the definition of cost-sharing arrangement and to better align the treatment of payments into a cost-sharing arrangement and payments received from a cost-sharing arrangement.
New anti-money laundering watchdog planned
The Treasury has unveiled plans to create a new watchdog that will tackle potential weaknesses in the supervisory system that criminals and terrorists may be trying to exploit. The Office for Professional Body Anti-Money Laundering Supervision will help improve the overall standards of supervision and ensure supervisors and law enforcement work together more effectively and is expected to be operational by 2018.