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Important changes to PAYE this Spring for Employers

HMRC is writing to all employers this month to remind them that from 2009/2010 onward they must file their Employer Annual Returns (P14s and P35s) online by the 19 May deadline and that there is no longer a paper filing option for small employers with fewer than 50 staff.

This could mean that if you file your return on paper, even if it is lodged with HMRC before 19 May, you could receive a penalty.

In order to be able to file the returns online employers must register with HMRC's PAYE online service via www.hmrc.gov.uk/paye. Software may be needed in order to file the data securely online.

Alternatively, an intermediary can file on an employer's behalf. Eacotts' payroll team can do this for you as part of a payroll processing service.

From May 2010 new HMRC penalties will apply for late payment of PAYE, covering income tax, NIC, student loan deductions and Construction Industry Scheme deductions. Employers may have to pay a penalty if more than one of the in-year PAYE payments due is late in any tax year or if any payment in particular is very late. The penalty could be as much as 5 % of any amount that is late if it is outstanding for more than six months, and a further 5% penalty if payment has not been made after 12 months.

Similar penalties apply to class 1A and 1B NICs.

For more information or for assistance with your payroll processing and P11D obligations, please contact Eacotts:

01628 665432

or email: services@eacotts.com