Employers trying to help employees buy their Christmas paychecks early can affect universal credit users by up to 55%.
That’s the stark warning from tax and consulting firm Blick Rothenberg. The company’s director of tax services, Robert Salter, said: “In the run-up to Christmas it is common for employers to pay their December pay earlier than usual but if they mis-date their electronic submissions , they will send to HMRC. can seriously affect universal credit
“Employers may pay wages for the month ending December 31 on December 17 rather than the last (traditional) working day of the month, because the office is closed and,” says Robert. / or to support employees from a cash flow perspective. A nice gesture, but it can turn out to be wrong. “
He added: “Such a seasonal payroll arrangement is well-founded and perfectly legal, but it is important for payroll providers to obtain an electronic payroll submission – known as an FPS. – to accurately record the time period involved in the payment of wages.
“For example, if using the dates above, FPS indicates earnings are purely for the period ending December 17th rather than the exact date of December 31st, which could affect to the employee’s entitlement to Universal Credit (UC). of this benefit. “
“It’s an easy mistake for employers – and their payroll teams – to make, but it can have a really painful impact on employees and their families,” says Robert. get UC, to recharge them.”
He added: “Broadly speaking, underreporting pay periods – and thus artificially increasing an employee’s perceived salary, can reduce their UC support from the Government by as much as 55 %. Not exactly the kind of Christmas present anyone wants this time of year. “
