Training for Parishes
9.00 am Employment Responsibilities
Andrew Monroe
Community Accounting Plus
10.45 am Coffee
11.00 am Gift Aid Small Donations Scheme
Andrew Kayley
HMRC
12.30 pm Lunch
1.30 pm Fees and PCCs
David Meredith
3.30 pm Close
Director of Finance S&NDBF
Employment
Responsibilities: Parishes
By
Andrew Monroe
Employment Service Manager
Community Accounting Plus
Main Topics for Today:
“Whistle-stop Tour”
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Status
Employed or Self-employed?
Worker or Employee?
Contracts of Employment
HMRC: PAYE and RTI
Further Advice
Status
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Why is this important?
Worker or Employee or Self-employed
(Gardener, Verger and Organist)
Where does liability rest
PCC, if not self-employed?
5
The Daily Mail
Forget clawing back billions from
Starbucks, Google and Amazon... The
taxman is targetting village cricket clubs!
Payments to weekend scorers, Sawbridgworth Cricket Club was
sent a bill for £14,403 plus £3,000 in ‘penalties and interest’.
Chairman Val Waring said it was a 'David versus Goliath' battle for
the club.
HMRC eventually waived some of the penalties. But the 151-yearold club was forced to take out a loan, and to ask its 350 members
to help pay the final bill of almost £15,500.
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Employee Status
Are they Employed or Self-Employed?
• Not determined by choice
• Determined by the facts of the employment relationship
• Self-employment elsewhere may not count
• HMRC Website: Employment Status Indicator (ESI)
• www.hmrc/calcs/esi.htm
e.g
i. Do they have a Contract of Employment
ii. Do they have to do the work or can they hire someone?
iii. Do they get paid by the hour/weekly?
iv. Do they set hours of work?
v. Do they supply their main tools of work?
vi. Do they have an established “business”?
Casual (Worker) Status
• No legal definition
• They carry out work personally, but have no Contract
of Employment
• Concept of “No Mutuality of Obligation”. If you do offer
any work, they do not have to accept
• Hence each period of employment does not link to
another, thus continuity does not happen
• Employment status is a “worker”
• Limited employment rights
• Beware “familiarity” leading to employee status
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Offers of Employment
• A contract exists as soon as an offer is made and is
accepted
• Conditional or Unconditional offers
• References / DBS checks
• Withdrawal of job offers
• Need for contract of employment to have full terms and
conditions of employment
• Contract type, fixed/permanent etc.
• Written main statement MUST be provided within 2 months
of starting work if employment expected to last longer than
8 weeks.
HMRC - PAYE
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Legal obligation to deduct PAYE and NI (if applicable)
No longer any exemption for local religious centres.
Do you need to register for PAYE? Yes if:
Pay above the PAYE threshold
Pay above the NI Lower Earnings Threshold (£109/wk)
Worker has another job
Worker is receiving a state, company or occupational
pension
 IF REGISTERED YOU MUST REPORT ALL
PAYMENTS IN RTI
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HMRC, PAYE
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Employment status?
Includes payments to employees and workers
Does new starter have a P45?
No – issue a P46 and get them to sign it
Where eligible *, if pay > £109/week (as of April 6th 2013)
* Obligations to pay Statutory Sick Pay
* Obligations to pay Statutory Maternity / Adoption or
Paternity Pay
Real Time Information (RTI)
 New as from April 2013
 All payments must be reported via RTI, on or before
payment is made
 HMRC can levy penalties for non-compliance
 RTI can only be reported via compliant software
 Manual payroll no longer possible
 HMRC provide their basic tools payroll which is RTI
compliant
 Provide end of year P60’s to staff
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Reporting in RTI
 EAS – Employer Alignment Submission, a one off
submission before reporting, to provide basic data on
workers (full name, NI number etc.)
 FPS – Full Payment Submission, reports what is paid to
worker. MUST be on or before any payment made to
worker (weekly/monthly/quarterly etc.)
 EPS – Employer Payment Submission, made if what you
pay does not match the FPS (eg. SSP payments)
 Beware irregular payments. If no FPS for 3 consecutive
payments, HMRC will assume they are a leaver unless
reported they are irregular!
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Further Advice
• CA Plus Website (www.caplus.org.uk)
• Employment Pages
• Downloadable Advice Guides
• Free monthly Employment Newsletter via email
• (Registration via website)
• Also, can be downloaded from website
14
Andrew Kayley
Specialist Personal Tax (Charities)
Bootle
What I will cover today?
• Gift Aid declaration recent changes
• Small Charitable Donations scheme
• On-line Claim Service
• Any other Gift Aid queries
Gift Aid declaration
Declaration must contain
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Name of charity
Name of donor
Donors home address
Description of payment(s)*
Declaration that payment(s) are Gift Aided
Charities must explain that the donor must have paid
sufficient UK income or capital gains tax to cover the tax
claimed by the charity (not including Council Tax & VAT)
Gift Aid Declarations
(GADs)
Feb. 2012 – new guidance published on GADs & introduced
a GAD tick list
• Clarify (for donors) the requirement to pay sufficient
income tax in each tax year
• Charities must keep GADs for 6 years (not 4 years) after
last payment was claimed on
Gift Aid Declarations
(GADs)
• All existing GADs (& any pre-April 2000 Deeds of
Covenant) are still valid for claiming purposes
• HMRC recommended all charities to update their GADs
by 31 December 2012
• Do not have to introduce 3 tick box options on Gift Aid
declarations
• Signature is still not required to make GAD valid
Small Charitable
Donations Act 2012
(Gift Aid small donations scheme)
From 6 April 2013; Charities, Churches & CASCs that
receive small cash donations of £20 or less will be able to
apply for a Gift Aid style repayment without the need to
obtain Gift Aid declarations for those donations.
The total amount of the small donations will be capped at
£5,000 per tax year = a top-up repayment of £1,250.
Summary of GASDS
• Only applies to donations received on/after 6 April 2013
(or Sunday 7 April 2013)
• GASDS is a public spending initiative (not a repayment of
tax) that gives Charities & CASCs a top-up payment on
donations they receive
• Charities & CASCS will claim a top-up payment of upto
£1,250 on £5,000 max. of small donations received in
any tax year
• 2 year time limit for claiming on GASDS donations
A small donation?
• A cash donation of £20 or less from an individual
• Donations must be collected and/or banked in the UK
• Cash donations from Companies or Trusts cannot be
GASDS
• Membership Fees are not small donations for GASDS
purposes
Interaction between
GASDS & Gift Aid
• Charities must claim Gift Aid on donations that are at
least 10% of the amount of their GASDS payments,
or
• The amount of GASDS received can be up to ten times
the amount of Gift Aid payments received
• Called the “matching principle” ?
The “matching principle”
A charity has income of £6,000 in 2013/14;
Gift Aid = £500 + GASDS = £5,500
Small donations are 10 times the Gift Aid donations
Charity can claim £125 on £500 Gift Aid + £1,250 on £5,000
of the total small donations received
Eligibility for claiming
GASDS
1. The charity must have been in existence for at least 2 full
tax years before it claims GASDS
2. Made successful GA claims in 2 of the previous 4 tax
years, with no gap in claims of 2+ years
3.Charity has not incurred an HMRC penalty in respect of its
GA or GASDS claims in the previous 2 tax years.
Why? - A good Gift Aid record gives some assurance to
HMRC that a charity has appropriate internal processes in
place to operate GASDS correctly
Connected Charities
The limit on which a Charity may claim a top-up payment
may be reduced if a charity is connected with one or more
charities.
This includes;
•The same person has control of both charities
•A group of two or more persons has control of both
charities
Connected Charities
The restriction ensures as far as possible that charities that
operate in a broadly similar way but are structured
differently receive the same entitlements under the scheme
Prevents charities from fragmenting in order to be eligible
for multiple GASDS allowances
Two Connected charities
Charity A
Gift Aid = £10,000
Small donations = £5,000
Charity B
Gift Aid = £5,000
Small donations = £2,500
Small donation claim
Charity A
Claims £625 on £2,500 small donations only
Charity B
Claims £625 on its £2,500 small donations
Community Buildings
The maximum small donations limit can be increased for
charities running their charitable activities in community
buildings.
If a charity runs activities at several centres then each
centre could satisfy the community buildings rules.
“Running charitable activities in a community building” =
local groups of at least 10 people that meet in the same
building on at least 6 occasions each year.
The people meeting must be beneficiaries of the charity
Community Buildings
Includes;
•A village hall
•A town hall
•A church
•A synagogue
•A mosque etc.
•A school
Does not include buildings used wholly
or mainly for residential purposes or
the sale of goods e.g.
• Vicarage / Manse
• Care homes
• Residential Hospice
• Charity shops
Community Buildings
Two or more buildings on the same or adjacent land will
be treated as a single building for GASDS community
building purposes;
e.g.
Church & Church Hall
A school that has 6 buildings in total
Church with a Garden Shed
HMRC can make an order that a building is, or is not, to
be treated as a community buildings
Collections in a
Community Building
Have to be 10 or more people present at every ‘Service’ for
small cash donations to be eligible.
Not eligible
1. Money collected during a ‘Service’ when 9 or less people
attended.
2.Money given in Collection boxes, wall safes or for lighting
a candle by visitors
3.Cash donations handed to Vicar or Church Wardens
whilst visiting Parish members in their home
Diocese of
Southwell
&
Nottingham
Central Gift Aid scheme
Parish
Parish
Parish
Parish
Community
Buildings
Parish
Parish
Parish
Parish
Parish
Parish
Parish
Parish
Parish
Parish
Parish
Parish
£5,000 allowance
divided equally
amongst all 360
Parishes - Diocese
will claim on up to
£5,000 for each
Community
Building
Independent parishes
Parish
Parish
Parish
Parish
Connected
Charities
£5,000 small
donation limit
divided equally
amongst all 360
Parishes
Parish
Parish
Parish
Diocese
Parish
Parish
Parish
Parish
Parish
Parish
Parish
Parish
Parish
Each Parish will
separately claim on
up to £5,000 of the
Community
Building amount
GASDS record keeping
HMRC will not be prescriptive but;
• Charities must be able to show that they have recorded
cash collected in the UK & the cash was paid into a UK
bank account
• Small donations & Gift Aid donations can be banked
together – if supported by cash collection sheets
• The number of people that attended each service
Any Questions?
Charity Repayment Claim Options in 2013
Option 2
Government
Gateway
Option 1
Paper Charity Claim
form - ChR1 (2013)
On line
Charity
Repayment
Service
(Up to 1,000 donors)
By post
HMRC
Data Processing
Centre
Extracted
Claim
information
From own
Laptop or PC
Claim
data
HMRC
Charities
Gift Aid, Other Income &
Charity Small Donation
scheme schedules
Option 3
3rd. Party
Software
(OOO’s of donors)
Paper ChR1 Claim Form +
ChR1CS (Continuation sheet)
Only available direct from HMRC
Form will be handwritten, scanned and data extracted
ChR1 - space for 15 Gift Aid donors + 6 Other taxed income
items + 2 Community Buildings + 5 Connected charities
ChR1CS - space for 5 more extra Gift Aid donors
Photocopies not acceptable
Typed schedules & Covering letters not acceptable
Charity Repayment
Claim service
Went Live in April 2013.
• only charities registered with HMRC can use the
Service
• must first register on the HMRC website - Online
services
• ID & Activation PIN posted to authorised official
• then need to Register and activate online service
• separate service for Agents that submit claims on behalf
of charities
3rd party Software route
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A data file is created (.xml schema) from a Gift Aid
software package
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Submitted to HMRC via Government gateway
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Technical Specification made available end of October
Format of data is checked (validated) and acceptance of
data is acknowledged
Test Service has been available since November 2012
HMRC Software Developers Support Team (SDST)
Need more information?
Any Questions?
FEES & PCCs
David Meredith – Director of Finance
Andrea Pritchard – Senior Finance Officer
FEES & PCCs
What are parochial fees?
Fees set by General Synod and Parliament for
certain occasional offices conducted by the
Church
– marriages, funerals...
FEES & PCCs
What has changed?
• The level of fees has changed
• Fees that were formerly payable to the
incumbent of the parish are now payable to
the Diocesan Board of Finance (DBF) under
legislation.
• PCC fees continue to be payable to the
PCC.
FEES & PCCs
Background
General Synod - Fees Policy Working Group
Four general principles:
1. Justifiable
2. Uniformity across the C of E
3. Inclusive as possible – extras only to apply
where people have a genuine choice
4. Affordable
FEES & PCCs
Background
• National Church issue guidance document
• Bishop’s Council consider policy regarding the
payment of fees to substitute ministers in
September and October 2012
• Draft Diocesan Regulations & Guidance circulated
for comment in November 2012
• Diocesan Regulations & Guidance issued in
December 2012
DIOCESAN BUDGET 2013
FEES & PCCs
FEES & PCCs
How were the figures calculated?
DBF fees are built up from assumptions about the costs of
ministry (from published statistics) and the likely number of
hours needed to provide a good ministry for the particular
service.
PCC fees include a location/building element based on national
statistics for the overall costs of repairs and maintenance of
church buildings and the number of hours in use, and an
element for administrative staffing based on a secretarial rate
of pay.
PCC fees for burials and monuments include an element to
provide for long-term maintenance of the churchyard.
FEES & PCCs
How were the figures calculated?
PCC fees (continued)
Heating and the cost of deploying vergers are not covered by
the statutory fees, and so PCCs are able to charge for these
items as ‘extras’, decided locally, if the person paying the
fees wishes to have them.
Travel expenses are not included in parochial fees, and the
previously issued guidance about travel expenses remains in
force.
FEES & PCCs
FEES & PCCs
FEES & PCCs
FEES & PCCs
Payments to substitute ministers
The DBF fee is legally owned by the DBF and it is for the DBF to decide the
purposes to which that income should be applied. In our diocese, Bishop’s
Council approved 50% of the DBF fee to be offered to a minister not in receipt
of a stipend.
Before the new Regulations and Guidelines only retired clergy with the Bishop’s
Permission to Officiate (PtO) were offered fees.
From January 2013, all retired clergy who have the Bishop’s Permission to
Officiate should be offered fees as set out in the Diocesan Table of
Apportionment of Fees.
From 1st April 2013 in addition to retired clergy with Permission to Officiate, all
licensed self-supporting ministers and licensed readers will be eligible to claim
50% of the DBF fee for weddings and funerals as appropriate as set out in the
Diocesan Table of Apportionment of Fees.
Ministers receiving such payments are responsible for declaring this income to
HMRC for tax purposes.
FEES & PCCs
What PCC items
parochial fees?
are
specifically
covered
by
The Order specifies that statutory parochial fees include any
costs and expenses incurred in relation to a service for:
• routine administration
(including arranging dates, times & making entries in
registers)
• making the Church available
• lighting
It is unlawful to make any additional charge, besides the
parochial fee, for these items.
FEES & PCCs
PCC “Extras”
Statutory parochial fees do not include payment for “extras”.
“Extras”:
• can only lawfully be charged for items over which those
receiving the ministry have been given a genuine choice.
• should never be imposed by the incumbent or PCC where
those paying the fees have not agreed that they wish to be
provided with the “extras” in question.
• charges need to be both realistic and fair.
FEES & PCCs
PCC “Extras”
Examples of the items for which a parish may decide to make
an extra charge include:
* heating;
* the services of a verger;
* the services of an organist, choir or bell-ringers;
* sheet or recorded music that has to be specially purchased;
* the provision of recorded or taped music;
* the taking of films, video or sound recordings
(where permitted);
* flowers;
* special furnishings.
FEES & PCCs
http://justforvicars-yourchurchwedding.org/resources/downloads/wedding-fees-form-2013
FEES & PCCs
Can fees ever be waived?
Under the new arrangements the incumbent or priest-in-charge
of the benefice concerned has an enhanced right of waiver,
after consultation with the churchwardens, for PCC fees.
However, an incumbent/priest in charge cannot waive fees
generally. They may only be waived “in a particular case”. That
means that the incumbent/priest in charge should be prepared
to give a reason for any decision to waive a fee.
FEES & PCCs
What about a larger fee if the parish church is a large
building?
There is no provision for variable charges according to the size
of building.
The Fees Policy Working Group looked at this and suggested
that in exceptional cases an additional voluntary contribution
may be invited (following consultation in every case with the
archdeacon or other diocesan advisor).
Why? The working group had 2 reasons:
1. The desire to maintain a uniform fee wherever a person
happens to live
2. Difficulty in establishing a legally clear method for
“banding” church buildings
FEES & PCCs
Travel expenses
No element for travel expenses is included in parochial fees.
Any travel expenses paid by the Funeral Director are in addition to
fees.
See the booklet ‘The Parochial Expenses of the Clergy – a Guide to
their reimbursement’.
http://www.churchofengland.org/clergy-office-holders/remuneration-and-conditions-of-servicecommittee/the-parochial-expenses-of-the-clergy.aspx
FEES & PCCs
FEES & PCCs
New Record of Parochial Fees Return
• Introduced for use from 1st January 2013.
• Each parish/group has a unique fees reference number
• We ask that these are filed with payment:
• larger parishes – monthly
• smaller parishes – at least quarterly
• a “nil” return is required for the quarter if no fee
income has been received.
• We recommend that churchwardens/treasurers make
arrangements to collect fees and complete the Return.
FEES & PCCs
Impact of new regulations & guidance
Individual clergy no longer assigning fees and completing
Returns.
Larger parishes
- administration generally in place, Parish Administrators
Smaller parishes
- fewer occasional offices
- administration impacting on PCC treasurers/churchwardens
FEES & PCCs
Accounting for parochial fees
Remember the DBF fee legally belongs to the DBF.
PCCs should only account for their portion of the
statutory fee in:
• PCC annual accounts.
• Return of Church Finance Form
No need to open a separate bank account for fees.
FEES & PCCs
Parishes in sequestration
A new form available to download from the diocesan website of
a printed copy can be obtained from the Clerk to the Registrar.
Fees for weddings & funerals should be accounted for on the
new Record of Parochial Fees Return.
Where a parish is in sequestration, retired clergy with
Permission to Officiate only, should be offered a Casual Sunday
/ Weekday Duty Fee as set out in the Diocesan Regulations &
Guidelines and travel expenses.
The current Casual Duty fee is £30.00.
FEES & PCCs
Monuments
Legally, no monument can be erected in a churchyard
without a faculty. In practice, however, the consistory
court generally does not insist on a faculty for an
ordinary monument provided it complies with
whatever general directions for the diocese the
Chancellor may have issued, and provided also that
the incumbent consents.
Please consult the Clerk to the Registry for
further advice!
FEES & PCCs
Funeral Directors
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Guidance has been issued on the new fees arrangements to
funeral directors.
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No payments in cash.
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New from January 2013, where there is no service in church,
but a service in a crematorium or cemetery, a statutory fee of
£160 is payable, with £21 payable to the PCC.
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For funerals at a crematorium, if the minister is not on the staff
of a local church, and it is not clear which PCC should be paid,
funeral directors have been directed to make payment to the
Diocesan Board of Finance on the relevant form.
FEES & PCCs
FEES & PCCs