PAYE Compliance

It's not too early to think about a spring clean.

To help out we’ve listed below some common areas where employers may come unstuck without some forethought.

P11D

• Dispensation - Still required up to April 2016 so you should ensure any agreement you hold is fit for purpose. Changes in expenses policies or procedures could render an existing agreement invalid.

• Company cars - Payments required for private use must be made in the tax year to allow deduction from the benefit on the P11D form. Payments to reimburse private fuel must be made no later than 5 May or the scale rate benefit may apply for the full year.

• Loans - If interest is being charged on a loan to an employee it must be paid in the tax year to allow deduction from the benefit on the P11D form.

• Initial preparation - Automatic penalties apply for late P11D(b) submission. Ensuring systems for expenses and benefits data collation are robust will save time and worry later on as the 6 July submission deadline nears.

PSA

• Do you need one? - Many employers use a PSA to settle the tax liability arising on small or motivational awards to employees. Inclusion in a PSA removes P11D reporting and means employees are not left with a tax bill on their award.

• Is it too late? - Awards that should be subject to Class 1 NIC in the absence of a PSA, vouchers being the common example, can not be included if they’ve already been given. Payroll adjustment and P11D declarations are required.

• Is my existing agreement sufficient? - Have there been any changes in benefit or expense provision this year that require an update of the PSA? The deadline for agreeing any changes with HMRC is 5 July this year.

• Data collation - Is there sufficient synergy between your payroll and benefits systems to allow easy and accurate data management and PSA completion?

Payroll

• PAYE remittance - Payments due for 2014/15 not with HMRC by 19 April (22 if paying electronically) will be subject to interest. In year interest will apply from 2015/16, are your systems sufficient to ensure remittances reach HMRC by the due date?

• Employee personal bills - Bills in the employees name that have either been paid by the employer or reimbursed to the employee should be subject to Class 1 NIC (and possibly tax) deduction through the payroll before the tax year end. Common examples include home telephone, home internet and personal mobile phone bills.

• RTI year end submission – Your Final Payment Submission should be with HMRC by 5 April and no later than 19 April to prevent having to send as an Earlier Year Update.

Dains are a specialist provider of employment taxes support and advice. If you would like to discuss these or any other Employment Tax issues please contact:

Samantha Davies sdavies@dains.com 07713 421899

Michelle Perry mperry@dains.com 07528 970201

James Hunt jhunt@dains.com 07973 614944