The start of a new tax year in April brought with it a number of changes. Here are two aspects that may affect churches.
From 1 April 2016 the National Living Wage was introduced for employees aged 25 and over. The National Living Wage is now £7.20 per hour which is an increase of 50p per hour. This means churches that are employing a cleaner, administrator or pastor in this age bracket have a responsibility to increase their pay to this higher rate.
The National Minimum Wage will continue to apply to those aged 24 and under, as well as apprentices.
Rates of pay
The current National Minimum Wage rates per hour (updated in October each year) are as follows:
Age 21 to 24 – £6.70: Age 18 to 20 – £5.30: Under 18 – £3.87: Apprentice – £3.30. This rate is for apprentices aged 16 to 18 and those aged 19 and over who are in their first year. All other apprentices are entitled to the National Minimum Wage for their age.
Every charity, including churches, is entitled to the Employment Allowance to reduce their liability for Class 1 National Insurance Contributions. This allowance is increasing on 6 April 2016 from £2,000 to £3,000. The Employment Allowance is per organisation and not per individual employee.
It is also possible to make a retrospective claim if this is not something an organisation has taken advantage of for the 2014/15 tax year.
