Sick Leave and Holidays

Sick leave and holiday

Statutory holiday sicknessentitlement is built up (accrued) while an employee is off work sick (no matter how long they’re off).

Any statutory holiday entitlement that isn’t used because of illness can be carried over into the next leave year. If an employee is ill just before or during their holiday, they can take it as sick leave instead.

An employee can ask to take their paid holiday for the time they’re off work sick. They might do this if they don’t qualify for sick pay, for example. Any rules relating to sick leave will still apply.

Employers can’t force employees to take annual leave when they’re eligible for sick leave.

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When an employee changes their holiday to sick leave they’re paid Statutory Sick Pay which will count towards the amount of holiday pay they’ve received. The exceptions to this rule are:

  • they don’t qualify for Statutory Sick Pay
  • they were off work sick and being paid ‘occupational sick pay’

Understanding Your Tax Code

Your tax code will normally start with a number and end with a letter

1150L is the tax code currently used for most people who have one job or pension

The numbers in your tax code tell your employer or pension provider how much tax-free income you get in that tax year

  1. HMRC works out your tax-free Personal Allowance
  2. Income that you haven’t paid tax on (such as untaxed interest or part-time earnings) and the value of any benefits from your job (such as a company car) are added up
  3. The income that you haven’t paid tax on is taken away from your Personal Allowance. What’s left is the tax-free income you’re allowed in a tax year
  4. The last digit in the tax-free income amount is removed

Letter

 What it means

L

You’re entitled to the standard tax-free Personal Allowance

M

Marriage Allowance: you’ve received a transfer of 10% of your partner’s Personal Allowance

N

Marriage Allowance: you’ve transferred 10% of your Personal Allowance to your partner

S

Your income or pension is taxed using the rates in Scotland.

T

Your tax code includes other calculations to work out your Personal Allowance, for example it’s been reduced because your estimated annual income is more than £100,000

0T

Your Personal Allowance has been used up, or you’ve started a new job and your employer doesn’t have the details they need to give you a tax code

BR

All your income from this job or pension is taxed at the basic rate (usually used if you’ve got more than one job or pension)

D0

All your income from this job or pension is taxed at the higher rate (usually used if you’ve got more than one job or pension)

D1

All your income from this job or pension is taxed at the additional rate (usually used if you’ve got more than one job or pension)

NT

You’re not paying any tax on this income

You can check your tax code here

Paternity Leave and Pay

Paternity Leave

You must tell your employer at least 15 weeks before the week the baby is expected:

  • the baby’s due date
  • when you want your leave to start, for example the day of the birth or the week after the birth
  • if you want 1 or 2 weeks’ leave

Work out when to tell your employer you want Paternity Leave online.

Your employer can ask for this in writing. You can ask for Paternity Pay at the same time, if you use form SC3 (or your employer’s own version).

Form SC3 can be accessed online here

Informing HMRC about a new employee

You must tell HM Revenue and Customs (HMRC) when you take on a new employee and be registered as an employer.

Before you pay your new starter follow these steps:

  1. Check you need to pay them through PAYE.
  2. Get employee information to work out their tax code – if you don’t have their P45, use HMRC’s ‘starter checklist’ (which replaced the P46).
  3. Find out if they need to repay a student loan.
  4. Use these details to set up your new employee in your payroll software.
  5. Register your employee with HMRC using a Full Payment Submission (FPS).

Further information can be found here

News from the Charity Commission

Do small charity annual reports and accounts meet the reader’s needs?

We are reviewing small charities’ annual reports and accounts because they are the prime means by which the trustees are publicly accountable to donors, beneficiaries and the wider public for the charity’s activities and how they have used the charity’s money.  Good reporting is important to public trust and confidence in both the reporting charity and the wider charity sector.

We were led us to focus on the following criteria:

  • have the trustees provided us with both an annual report and accounts?
  • does the annual report explain what activities the charity had carried out during the year to achieve its purposes?
  • do the accounts contain both an analysis of receipts and payments and a statement of assets and liabilities and are these consistent with each other?

You can find out more details here

Your Rights If Your Employer Is Insolvent

If your employer is ‘insolvent’ this means it can’t pay its debts. You have rights if this happens and can make a claim for money you’re owed.

What you can claim

The money will be paid to you by the government. It’s not guaranteed that you’ll get everything your employer owes you but you can claim for:

  • statutory notice pay
  • redundancy
  • up to 8 weeks’ wages, including a payment for a protective award if your employer has failed to consult collectively with staff
  • up to 6 weeks’ holiday pay
  • unpaid pension contributions – get in touch with the insolvency practitioner to claim this for you
  • a basic award for unfair dismissal

You can get up to £479 a week for each claim. For example, if you’ve claimed for redundancy and loss of notice you can get payments for both.

You can find more detailed information here

Starting the New Financial Year on the Right Foot

Robust financial management is vital so charities can protect themselves against financial difficulties or abuse, and meet the needs of their beneficiaries.

There’s no better time than the start of the new financial year to assess your charity’s financial situation and financial controls, to see how you can improve them. Doing this is key to making sure that your trustees are able to protect the charity’s assets and resources.

The Charity Commission has recently updated their Charity finances: trustee essentials (CC25) guidance to help trustees and charity staff get to grips with the basic areas of financial management. It also links to more detailed guidance on a number of areas.