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Posted Sat, 10 Jun 2023 08:27:52 GMT by
Hello all, I am writing on behalf of an employer who is currently facing a unique predicament regarding their staffing situation, and we are seeking clarification and guidance. The employer is urgently in need of additional staff, but they are hesitant to increase the working hours beyond 16 hours per week. Their accountant has advised them that employees working 16 hours or less are not required to pay taxes, whereas any hours worked over 16 are taxable. While the employer understands the importance of having an adequate workforce, they are concerned about the tax implications of increasing the working hours for their employees. They have been advised by their accountant that staying within the 16-hour threshold is beneficial in terms of tax obligations. However, the employer is facing significant challenges due to the limited number of hours their staff members are available. They have approached me for advice and assistance in persuading them to increase the working hours, as they desperately require additional staff to meet their operational needs. Given this situation, we kindly request clarification on the following matters: Is it true that employees working 16 hours or less are exempt from paying taxes, while any hours worked over 16 are taxable? Are there any alternative options available for the employer to address their staffing needs without adversely impacting the tax obligations for both the employer and the employees? Could you provide any guidance or recommendations for the employer to ensure compliance with tax regulations while also accommodating their staffing requirements?
Posted Tue, 13 Jun 2023 13:19:31 GMT by HMRC Admin 10
Hi
The amount of tax that someone pays is based on their tax code and earnings not on the amount of hours they work.
It may be that by working 16 hours or less the employees on a normal tax code may not earn enough to pay tax however all earnings are subject to tax and the number of hours worked has no direct impact.
Thankyou.

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