The terms of a contract of employment can include various ways in which the entitlement to pay is calculated. For example, the employee may be paid solely by reference to hours worked or some, or all, of his pay entitlement may be related to performance levels. Employees may also be paid at various intervals, although pay intervals of a week or a month are the most commonly used. However, a common measure of pay is needed for the purposes of the calculating the amounts that the employer must pay in relation to many of the statutory employment rights (such as holiday pay or breaches of the right to statutory notice, the right to written reasons for dismissal or the right to an appeal against dismissal). The common measure used is the employee鈥檚 weekly pay.
This guidance note focuses on the method of working out a week鈥檚 pay as set out in detail in the Employment Rights Act 1996.
The date on which you start for the purpose of calculating a week鈥檚 pay depends
Allowable deductions for employee-related expensesThis guidance note covers the tax treatment of some common types of trading expenditure relating to employees. Some of these are disallowable under general principles, for example the wholly and exclusively test or capital versus revenue expenditure.
Classes of NIC and who pays themClass 1 NICClass 1 NIC is payable on earnings paid to an employed worker which derive from, or are treated as deriving from, an employed earner鈥檚 employment in the UK. There are two kinds of Class 1 NIC, primary contributions for which the employee is liable and
Bare trusts 鈥� income tax and CGTThis guidance note explains how trustees of bare trusts are treated for income tax and capital gains purposes. Although a bare trust is, in equity, a type of trust, for both income tax and capital gains tax purposes its existence is transparent. This means that no tax