The release of Opera 3 (2.60) includes the statutory payroll changes for the 2018-19 year-end and the new 2019-20 tax year. Also included are the changes for Making Tax Digital for VAT. Making Tax Digital for VAT comes into force on 1 April 2019 and will apply for most businesses with annual sales over the VAT threshold of £85,000. If Making Tax Digital for VAT applies to you, you’ll have to use digital tools to keep records of your income and costs.
This upgrade is essential as it contains the Payroll information to enable customers to submit their year-end information correctly to the HMRC and further legislative changes for April 2019.
Please check back regularly for further updates regarding the Pegasus Upgrades 2019.
Welsh Income Tax
Welsh Income Tax rates and thresholds will be recorded in the software for the new tax year. From 6 April 2019, some of the Income Tax paid by people living in Wales will be paid to the Welsh government. The Welsh government will be able to vary the rate paid by Welsh resident taxpayers. This means that they could pay different rates of Income Tax than taxpayers in the rest of the United Kingdom. In practice the UK government will reduce the basic, higher and additional rates of Income Tax by 10p. The Welsh government will then decide the rates that will be added to the reduced UK rates.
Company Car Fuel Types
Changes will be introduced to fuel classifications in the 2019-20 tax year. For those employees who already have company cars, you will need to review and if necessary, amend the fuel types.
2018-19 fuel types 2019-20 fuel types
- D – Diesel Either stays as D – Diesel or F -Diesel cars meeting Euro standard 6d/RDE2
- E – Electric A – All other cars
- H – Hybrid A – All other cars
- A – All other cars A – All other cars
Postgraduate loans will be deducted via the PAYE process from April 2019 in the same way as Student loans. The repayment threshold is set at £21,000 and loans will be repaid at a rate of 6%. The deductions will be based on the pay that is subject to National Insurance contributions. PGL1 and PGL2 notices are being introduced in paper and electronic formats to start and stop Postgraduate loan deductions. These will run alongside the existing SL1 and SL2 notices for Student loans.
Full Payment Submissions
These new details are included in the FPS in the 2019-20 tax year:
- Values for postgraduate loan repayments
- New fuel types for company cars
- An indicator for Welsh taxpayers.
New NI, PAYE and statutory payments rates and bands
The usual changes to National Insurance rates and earnings limits, Income Tax rates and bands, tax allowances, statutory payment rates and so on will be updated in the system tables in the software. These will be updated for each company during the Update Data Structures process as usual. From 06/04/2019 the total minimum Auto Enrolment contributions will be 8% – with the employer contributing at least 3%.
Making Tax Digital for VAT
A new version of Pegasus Scheduler will include changes to allow VAT Returns to be submitted to HMRC using the new Making Tax Digital for VAT service ‘MTD VAT API’. All sites must install Pegasus Scheduler along with Microsoft SQL Server/Express and Microsoft .NET Framework 4.7.2. Companies will be able to complete the following activities in Opera 3:
• Switch on Making Tax Digital for VAT at the appropriate time using the Company Profiles screen.
• Authorise Opera 3 with HMRC to allow VAT Returns to be submitted.
• Monitor the current VAT Return values and submissions using a new screen called the ‘MTD VAT Centre’.
• Retrieve the next due VAT period start date, end date and payment due date from HMRC using the MTD VAT Centre.
• Post VAT adjustments to amend VAT Return values prior to submitting VAT Returns to HMRC.
• Consolidate multiple companies VAT data into a group VAT Return.
• Submit your VAT Return using the new Making Tax Digital for VAT service.
A new version of Opera 3 SQL SE will also include changes to allow VAT Returns to be submitted to HMRC using the new Making Tax Digital for VAT service. Pegasus Scheduler is not used with Opera 3 SQL SE. Full details and instructions for setting up and using the Making Tax Digital for VAT features will be provided when the software is released.