The new Debt Arrangement Scheme places an obligation on employers to manage a deduction from salary for the repayment of debt upon request.
The rules apply to employees who live in Scotland but could potentially affect businesses in the UK who employ Scottish residents.
The scheme is designed to help staff in serious financial difficulty to manage their debts by paying them off at source before the receipt of their net salary.
All forms of debt including credit and store card debts and rent arrears will be included under the scheme.
Commenting on the issue British Chambers of Commerce’s Director General David Frost said: “The introduction of this scheme is a step too far for business. It is madness that employers should be responsible for arranging to pay off debt that an employee runs up.
“A BCC survey has shown that only a quarter of businesses have a dedicated HR employee. This means that attention and time has to be diverted from other crucial areas of running a business to manage the growing load of obligations.”
The payroll burden has grown by a third since 1997, say the organisation and currently 24 different obligations and payroll penalties already apply.
Frost added: “We need to see a government commitment that no further payroll obligations will be added to employers. The Inland Revenue is the body with the specific remit of administering and collecting tax on behalf of the government, not British business.”
For further information on the Debt Arrangement Scheme please go to: Scotland legislation
