Attachment of Earnings: Definition & Deductions

An Attachment of Earnings is a legal document that directs you to divert a portion of your employee’s wages to pay off their Council Tax bill. If one is received, you must deduct the taxes stated on the form from your employee’s pay, unless they receive their wages within the next seven days. Overtime and holiday pay also count for these garnishments. 

Additionally, if you receive an Attachment of Earnings for someone you don’t employ, you must inform the court within 10 days. Non-compliance with the order can result in your receiving a fine. 

Both the employee and employer receive the Attachment of Earnings order. You will mainly be responsible for deducting the required money from your employee’s wages, with most of the follow-up for the order being on the employee’s side. 

Additionally, an employee can receive multiple orders at once. Each will be labelled as priority or non-priority; this determines how you’ll handle the order. Priority orders are deducted from wages first, and then non-priority orders are deducted. If there are several non-priority orders, then you can apply to the court to have them consolidated. 

An Attachment of Earnings comes paired with several important pieces of information and forms that help employers and employees deal with them. The court order will tell you the following:

• How much money your employee owes

• The priority of the order

• The Normal Deduction Rate (NDR), which tells you how much to deduct from the employee’s wage

• The Protected Earnings Rate (PER), which is the lowest amount an employee should still be able to take home after deductions. PER is also called upon in cases of unpaid leave.

• Whether deductions need to be made weekly or monthly

Additionally, the employee will receive an N56, or a “statement of means” form. It’s meant to explain their financial and employment situation to the courts and is typically submitted with a copy of their most recent payslip. 

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The amount deducted from the employee’s pay is determined based on their net weekly earnings. Typically, the courts want employers to start these deductions the next time the employee is paid, unless that date is within the next seven days. 

Below is a table to help you know what weekly pay to expect:

And monthly pay:

Your employee can suspend an Attachment of Earnings by ticking a box on their N56 form. If the court accepts their reasoning for needing suspended payments, it’ll be on the condition that they repay the original Council tax. When the Attachment of Earnings is stopped, the court will not inform you unless the employee fails to meet the agreed-upon payment. 

An Attachment of Earnings isn’t something to take lightly. Not abiding by the order can lead to significant and serious financial penalties for your company. 

Personio can help you keep track of wage deductions with its digital personnel feature that keeps all employee information in one easy-to-use place. Book your free demo to learn how Personio can help you manage your workplace.

An Attachment of Earnings order instructs you to deduct a predetermined amount from your employee’s wages to pay off their council tax. 

The amount that an Attachment of Earnings order can deduct is determined by the employee’s net weekly or monthly earnings. Deductions should never go beneath your worker’s protected earnings rate. 

Employers cannot stop an Attachment of Earnings order, but you can ask the court to change the deductions from weekly to monthly to better fit in with your organisation’s payment schedule.  The employee with unpaid council taxes can request a suspension of the Attachment of Earnings order by ticking the appropriate box on an N56 form.